Discuss the below:
Q: A large law firm uses an average of 40 boxes of copier paper a day. The firm operates 260 days a year. Storage and handling costs for the paper are $30 a year per box, and it costs approximately $60 to order and receive a shipment of paper.
The first two parts (What order size would minimize the sum of annual ordering and carrying costs? Compute the total annual cost using your order size), under a $10 fixed cost of ordering (S). Repeat for S = 20, 30, 40, . . . , 100.
Explain in a short paragraph or two, what happens to the optimal order quantity, the time between orders, and the average inventory as S decreases.