Final answer:
The questions pertain to calculating the Economic Order Quantity, reorder point, and total annual costs for inventory management, as well as understanding pricing strategy and market equilibrium.
Step-by-step explanation:
The student has asked several questions related to inventory management and pricing strategy regarding a product, specifically pizzas.
Questions a, b, and c relate to inventory management, such as determining the Economic Order Quantity (EOQ), calculating the reorder point, and finding out the total annual inventory carrying cost for the product. Question d asks for the total annual cost, including both ordering and carrying costs.
We do not have the specific data provided for these calculations, so a general approach to each concept can be presented instead of actual numerical solutions.
EOQ is a formula used by businesses to minimize the costs associated with inventory management.
It involves finding the ideal order quantity a company should purchase to minimize costs related to ordering, receiving, and holding inventory. The formula for EOQ considers factors like demand rate, ordering costs, and carrying costs.
The reorder point calculation notifies a business when it is time to place a new order for a product. It is determined based on the lead time to receive an order and the sales rate during that lead time. Inventory carrying cost is the total cost a company incurs for holding its inventory over a certain period.
It includes storage costs, insurance, depreciation, and opportunity costs. Finally, the total annual cost is the sum of the annual ordering cost and the annual carrying cost.
The provided information from Step 2 discusses pricing strategy, another important aspect of business management. This includes the firm's base cost of producing their product and the desired profit, contributing to setting a price point. Additionally, the steps correctly identify equilibrium as the point where quantity demanded equals quantity supplied.