Consider a factory that produces gear boxes at the annual rate of 12,000. Demand for the gear boxes is 7200 per year. It costs the factory $100,000 for each run, and the holding cost per gear box per year is $500. Compute the factory's optimal average inventory. Round your answer to the nearest whole number.

Cornerstones of Cost Management (Cornerstones Series)
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Chapter20: Inventory Management: Economic Order Quantity, Jit, And The Theory Of Constraints
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Problem 6E: Ottis, Inc., uses 640,000 plastic housing units each year in its production of paper shredders. The...
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Consider a factory that produces gear boxes at the annual rate of 12,000. Demand for the gear boxes is 7200 per year. It costs the factory $100,000 for each run, and the holding cost per gear box per year is $500. Compute the factory's optimal average inventory. Round your answer to the nearest whole number. 

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