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Chris Sandvig Irrigation, Inc., has summarized the price list from four potential suppliers of an underground control valve. See the accompanying table. Annual usage is 2,400 valves; order cost is $10 per order; and annual inventory holding costs are $3.33 per unit. Which vendor should be selected and what order quantity is best if Sandvig Irrigation wants to minimize total cost?

Chris Sandvig Irrigation, Inc., has summarized the price list from four potential suppliers of an underground control valve. See the accompanying table. Annual usage is 2,400 valves; order cost is $10 per order; and annual inventory holding costs are $3.33 per unit. Which vendor should be selected and what order quantity is best if Sandvig Irrigation wants to minimize total cost?

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
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Chris Sandvig Irrigation, Inc., has summarized
the price list from four potential suppliers of an underground
control valve. See the accompanying table. Annual usage is
2,400 valves; order cost is $10 per order; and annual inventory holding costs are $3.33 per unit.
Which vendor should be selected and what order quantity
is best if Sandvig Irrigation wants to minimize total cost?

VENDOR A VENDOR B QUANTITY PRICE QUANTITY PRICE 1-49 $35.00 1-74 $34.75 50-74 34.75 75-149 34.00 75-149 33.55 150-299 32.80 150-299 32.35 300-499 31.60 300-499 31.15 500+ 30.50 500+ 30.75 VENDOR C VENDOR D QUANTITY PRICE QUANTITY PRICE 1-99 $34.50 1-199 $34.25 100-199 33.75 200-399 33.00 200-399 32.50 400+ 31.00 400+ 31.10
Transcribed Image Text:VENDOR A VENDOR B QUANTITY PRICE QUANTITY PRICE 1-49 $35.00 1-74 $34.75 50-74 34.75 75-149 34.00 75-149 33.55 150-299 32.80 150-299 32.35 300-499 31.60 300-499 31.15 500+ 30.50 500+ 30.75 VENDOR C VENDOR D QUANTITY PRICE QUANTITY PRICE 1-99 $34.50 1-199 $34.25 100-199 33.75 200-399 33.00 200-399 32.50 400+ 31.00 400+ 31.10
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