Problem $2(12$ points$)$

Maverick Bookstores is a local bookstore selling textbooks and stationery items. The demand for spiral$-$bound notebooks at the store is constant at $5000$ notebooks$/$year$.$ It purchases the notebooks from a supplier at $\backslash (\backslash$$ $1\mathrm{.}50\backslash )$ per notebook. Each time Maverick Bookstores places an order it incurs an ordering cost of $\backslash (\backslash$$ $50\backslash ).$ The company estimates that the yearly holding cost of inventory is $\backslash (18\backslash \%\backslash )$ of the unit purchasing cost. Maverick Bookstores needs your help in determining the optimal ordering policy.

a$.$ Determine the Economic Order Quantity, the time between placement of orders, and the total annual cost $($i$.$e$.,$ the sum of holding and ordering costs$)$ incurred by Gopher Bookstores. $(4$ points$)$

b$.$ Determine the reorder point assuming the order lead time is $5$ workdays and Maverick Bookstores operates $250$ days a year. $(4$ points$)$

c$.$ Suppose that the supplier is a wholesale seller and requires orders to be placed only in multiples of $500$ notebooks. How many notebooks should Maverick Bookstores order every time it places an order and how much additional total variable annual cost would Maverick Bookstores incur to meet this requirement? $(4$ points$)$