Purchasing and Supply Chain Management
6th Edition
ISBN: 9781305809789
Author: MONCZKA
Publisher: Cengage
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Chapter 11, Problem 13DQ
Summary Introduction
To determine: Whether the firm can use target pricing model without a follow-on cost-savings sharing agreement.
Introduction: Target pricing contract is based on the cost remunerative mechanism in which the servicer would repay the cost based on the actual cost subject to the request during the completion of the project.
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The annual demand for water bottles at Mega Stores is 500 units, with an ordering cost of Rs. 200
per order. If the annual inventory holding cost is estimated to be 20%. of unit cost, how frequently
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Order size Unit cost (Rs.)
1 – 49 pcs. 20.00
50 – 149 pcs. 19.50
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Help answer showing level work and formulas
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Purchasing and Supply Chain Management
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