Question: Let's consider the inventory problem with quantity discounts. The parameters are as follows: Annual demand lambda = 2 5 0 0 0 , Order cost

Let's consider the inventory problem with quantity discounts. The parameters are as follows:
Annual demand lambda =25000,
Order cost K =100,
I =0.3.
For order quantities between 0 and 499, you pay c(Q)=21.60 per unit
For order quantities between 500 and 999, you pay c(Q)=20.95 per unit
For order quantities >=1000, you pay c(Q)=20.90 per unit.
What is your total cost per year if your order quantity is 680 per order?
What is the optimal order quantity (round your final answer to the nearest integer)?

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