Babson Books is a local bookstore that sells many popular fiction and nonfiction titles and is open 52 weeks per year. While there are new bestsellers each month that quickly decline in popularity, there are a few staple books that continue to sell in relatively stable quantities for years. One such book, The Fellowship of the Ring, has a stable demand for 10 copies per week on average. Each copy costs Babson Books $7 to purchase from their supplier. They incur shipping charges of $40 each time they place an order for the book. Babson Books estimates that the majority of its holding costs are from the cost of storage which is roughly $3 per book per year. In addition, they pay insurance to protect their inventory at a cost of 1 cent per copy per month. Their supplier charges an administrative fee of $20 per order to process orders