Rocky mountain tire center sells 15,000 go-cart tires per year. the ordering cost for each order is $35, and the holding cost is 40% of the purchase price of the tires per year. the purchase price is $25 per tire if fewer than 200 tires are ordered, $19 per tire if 200 or more, but fewer than 5,000, tires areordered, and $13 per tire if 5,000 or more tires are ordered.

a) how many tires should rocky mountain order each time it places an order? rocky mountain's optimal order quantity is (enter your response as a whole number).

b) what is the total cost of this policy?

Suppose that a major city’s main thoroughfare, which is also an interstate highway, will be completely closed to traffic for two years, from january 2014 to december 2015, for reconstruction at a cost of $535 million. if the construction company were to keep the highway open for traffic during construction, the highway reconstruction project would take much longer and be more expensive. suppose that construction would take four years if the highway were kept open, at a total cost of $800 million. the state department of transportation had to make its decision in 2014, one year before the start of construction (so that the first payment was one year away). so the department of transportation had the following choices: (i) close the highway during construction, at an annual cost of $267.5 million per year for two years. (ii) keep the highway open during construction, at an annual cost of $200 million per year for four years. now suppose the interest rate is 80%. calculate the present value of the costs incurred under each plan.