Question: The air filter manufacturer in problem (2) informs you that due to limited production capacity and high demand, he cannot ship your order at once, but instead will ship you 300 filters per day until the order is filled. Again, the company is open for business 20 days per month, 12 months per year and it takes 2 days for an order to arrive once it has been placed.

(a) What quantity do you order now?

(b) What is the maximum inventory level?

(c) Compute the total annual inventory costs.

(d) What is the reorder point?