Pet Store (PS) sells a very popular blend of cat food at $20 per pack. Average weekly demand of this cat food at PS is 500 packs per week. The owner of the store, John Snow, orders the packs of cat food from the Ice & Fire Co. (I&F) at $15 per pack and have to pay a flat fee of $100 per order for shipping and handling. PS uses a fixed order size as their inventory policy. Assume that the opportunity cost of capital and all other inventory cost is 15 percent annually and that there are 50 weeks in a year.
How many packs of cat food should PS order at a time?
