A large university buys printer cartridges from a printer dealer, who charges the cartridges based on the number ordered. The university uses 20,000 cartridges per year. The cost of placing an order is $100. The cost of carrying a cartridge is 15% of the price of the cartridge. The dealer’s price per cartridge is tabulated below.

No of cartridges ordered Price per cartridge 0 … Q 61000 $25 1000 … Q 61500 $23 Q Ú 1500 $21

a. Determine the optimal order quantity.

b. Determine the total annual minimum inventory costs. LO.1