A supplier's price schedule is: Order Quantity 0-99 100 or more Price per Unit $50 $45 If ordering cost is $16 per order, annual holding cost is 20 percent of the purchase price, and annual demand is 1,800 units, what is the best order quantity?
A supplier's price schedule is: Order Quantity 0-99 100 or more Price per Unit $50 $45 If ordering cost is $16 per order, annual holding cost is 20 percent of the purchase price, and annual demand is 1,800 units, what is the best order quantity?
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:A supplier's price schedule is:
Order
Quantity
0-99
100 or more
Price per Unit
$50
$45
If ordering cost is $16 per order,
annual holding cost is 20 percent of
the purchase price, and annual
demand is 1,800 units, what is the
best order quantity?
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