2. The Pen&Pencil Shop is a producer of pencils. The annual demand for pencils is 15,000 units. Pencils can be produced at a rate of 200 per day, and the usage rate is 50 units per day. The annual storage cost is $2 per pencil, and the machine setup cost is $50 per run.

a. Determine the economic run quantity b. How many runs per year will there be? c. Compute maximum inventory level d. Compute total annual cost, assuming the economic run quantity is used for quantity.