# Question

A mail- order house uses 18,000 boxes a year. Carrying costs are 60 cents per box a year, and order-ing costs are $ 96. The following price schedule applies. Determine

a. The optimal order quantity.

b. The number of orders per year.

Number of Boxes Price per Box

1,000 to 1,999 ..........$ 1.25

2,000 to 4,999 .......... 1.20

5,000 to 9,999 .......... 1.15

10,000 or more .......... 1.10

a. The optimal order quantity.

b. The number of orders per year.

Number of Boxes Price per Box

1,000 to 1,999 ..........$ 1.25

2,000 to 4,999 .......... 1.20

5,000 to 9,999 .......... 1.15

10,000 or more .......... 1.10

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