Suppose that a manufacturer has one major buyer who orders its EOQ of 20,000 units about once per month. Annual demand is 240,000 units. The manufacturer has a setup cost of $180 per order and a holding cost per unit of $10. If the manufacturer practices lot-for-lot production, what would be the manufacturer's annual holding and setup cost?
a. $1
b. $20,000
c. $2,160
d. $102,160
e $40,000
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