determining the optimal order quantity for this item..

Introduction to Production and operations Managent The bike shop estimated estimated that they will require 8,000 bicycle bags over the next year. Administrative and other costs associated with placing an arder ate estimated $26 per order. The Bike Shop uses a rate of 12% of the purchase price per year for calculating Inventory holding costs. The Bike Shop's supplier encarages its customers to order in large quantities by offering price break on volume. Hence, the price per bag depends on the order quantity as follows: Price per bag ] Size 500-699 Toot 10 Required: Determine the optimal order quantity for the item