Cat Lovers Inc. (CLI) is the distributor of a very popular blend of cat food that sells for $1.25 per can. CLI experiences demand of 500 cans per week on average. They order the cans of can food from the Nutritious & Delicious Co. (N&D). N&D sells cans to CLI at $0.50 per can and charges a flat fee of $7 per order for shipping and handling. CLI 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.
(a) How many cans of food should CLI order at a time?
(b) What is CLI?