A college bookstore buys pads of paper for 60 cents each and sells them to students for 80 cents each. Students use 200 pads per week, and it is reasonable to assume that the pads are continuously withdrawn. Each time an order is placed, there is a trucking cost of $50 (independent of the size of the order). The cost of maintaining the display racks where the pads are sold is estimated to be 3 cents per pad per week Shortages are allowed at an estimated cost of 5 cents per pad per week.

(a) Assuming the same quantity is ordered each time an order is placed, what should the size of the order be and how often should it be placed to minimize the total cost per week?

(b) What are the minimum total cost and the average gross profit per week?

(c) Suppose the bookstore has to pay 60 cents per pad if it orders less than 1,100. If it orders 1,100 or

more pads, then the price drops to 55 cents per pad. In this case, what should the size of the order be and how often should it be placed to minimize the total cost per week?