QUESTION $3$

Annakay Ferguson sells beauty supplies. Her annual demand for a particular skin lotion is $7,000$ units. The cost of placing an order is $$10,$ while the holding cost per unit per year is $10$ percent of the cost. This item currently costs $$2\mathrm{.}50$ if the order quantity is less than $1500.$ For orders of $1501$ units or more, the cost falls to $$2\mathrm{.}45.$ To minimize total cost, how many units should Vicky order each time she places an order? What is the minimum total cost? $(6+6$ marks$)$

b$).$ Define outsourcing and discuss its advantages and disadvantages. $(4$ marks$)$

c$).$ What are the four sourcing strategies, how do they work, and what are the advantages of each? $(4$ marks$)$