Mac-in-the-Box, Inc. sells computer equipment by mail and telephone order. Mac sells 1200 flat-bed scanners per year. Ordering cost is $300 and annual holding cost is 16 percent of the item’s price. The scanner manufacturer offers the following price structure to Mac in-the Box

Order Quantity Price per Unit 1

0 to 11 .......$520

12 to 143 .....$500

144 or more ......$400

What order quantity minimizes total annual costs?