Please explain each option in detail and step by step.

1. (Inventory Management - Part 1) A chemical firm produces sodium bisulfate in 20-pound bags. Demand for this product is 20 tons per day. The capacity for producing the product is 502 tons per day. Set up costs $100, and storage and handling costs are \$5 per ton a year. The firm operates 200 days a year. (Note: 1 ton =2000 pounds). (a) How many bags per run are optimal? (b) What would average inventory be for this lot size? (c) Determine the approximate length of a production run? (d) About how many runs per year would there be? (e) How much could the company save annually if the set up cost could be reduced to $25 per run