Orders should be placed so that the new order arrives before existing inventory runs out. when to order can be calculated by multiplying the average order lead time by the average daily inventory use. this calculation is called the reorder point (rop).rop = lt * average daily demand, where average daily demand = annual demand / business days because of variability in daily usage and/or order lead time, a company may hold some safety stock. problems: antique manufacturers old-fashioned, rotary telephones for use in movie scenes (and other displays). worldwide demand is 44,000 phones per year. the rotary dial on each phone costs $0.75. set up costs are $8. the carrying costs are 12%. 1. what is the economic order quantity (eoq)? 2.what are the annual order costs? 3.what are the annual carrying costs? 4.if antique operates 250 eight-hour days per year and the lead time is eight days, what is the rop?