Question: 12.20 Bell Computers purchases integrated chips at $350 per chip. The holding cost is $35 per unit per year, the ordering cost is $120 per

12.20 Bell Computers purchases integrated chips

12.20 Bell Computers purchases integrated chips at $350 per chip. The holding cost is $35 per unit per year, the ordering cost is $120 per order, and sales are steady, at 400 per month. The com- pany's supplier, Rich Blue Chip Manufacturing, Inc., decides to offer price concessions in order to attract larger orders. The price structure is shown below. Rich Blue Chip's Price Structure Quantity Purchased 1-99 units 100-199 units 200 or inore units Price/Unit $350 $325 $300 RIMER Bell Computers wishes to use a 10% holding cost rather than the fixed $35 holding cost in part a. What is the optinial order quan- tity, and what is the optimal cost? *

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