Thunder Autoparts in Warren, OH uses 124,460 plastic connectors annually. The supplier of this part is nearby, such that immediately upon receiving an order, the supplier begins delivery at the rate of 1,200 connectors per day. Thunder Autoparts operates 254 days per year.
Thunder Autoparts has estimated that the ordering cost is $100 every time they place a new order, and the cost of carrying connectors in inventory before they are processed is $0.55 per connector on an annual basis. Determine the following:
a) The optimal order size
b) The maximum level of inventory held for this part
c) The total inventory cost associated with the optimal order quantity
d) The number of operating days required to receive an order.
e) The number of operating days between orders