Answer:
The appropriate solution is:
(a) 2828 cases each time
(b) $4005656.85
(c) $3609800
Step-by-step explanation:
The given values are:
Annual demand,
D = 200,000 cases
Per case cost,
C = $20
Carrying host,
H =

= $

Ordering cost,
S = $40
(a)
The economic order quantity will be:
⇒

On substituting the values, we get
![=\sqrt{[((2* 200000* 40))/(2) ]}](https://img.qammunity.org/2022/formulas/business/college/4hztctcq0kiz0gm5lwyuflkxq3ytdylgic.png)


(b)
According to the question,
The annual ordering cost will be:
=

=

=
($)
The annual carrying cost will be:
=

=

=
($)
The annual purchase cost will be:
=

=

=
($)
Now,
The total inventory cost will be:
=

=
($)
(c)
According to the question,
Order quantity,
Q = 10000 cases
Per case cost,
C = $18
Carrying cost,
H =

=

The annual ordering cost will be:
=

=

=
($)
The annual carrying cost will be:
=

=

=
($)
The annual purchase cost will be:
=

=

=

Now,
The total cost of inventory will be:
=

=
($)