The
I-75 Carpet Discount Store in North Georgia stocks carpet in its warehouse and
sells it through an adjoining showroom.
The store keeps several brands and styles of carpet in stock; however,
its biggest seller is Super Shag carpet.
The store wants to determine the optimal order size and total inventory
cost for this brand of carpet given an estimated annual demand of 10,000 yards
of carpet, an annual carrying cost of $0.75 per yard, and an ordering cost of
$150. The store would also like to know
the number of orders that will be made annually and the time between orders
(i.e., the order cycle) given that the store is open every day except Sunday,
Thanksgiving Day, and Christmas Day (which is not on a Sunday).