A company that produces aluminum foil, offers the following discount schedule for its sheets as follows: 1 to 499, $10 each; 500 to 999, $8.5 each; and 1000 or more, $8.0 each. Mini Market X orders aluminum foils from this company. The mini market’s ordering cost is $100. The holding cost is 20 percent of the unit cost and the annual demand is 2000 sheets. Determine the optimal order quantity and the total annual cost.

Answer rating: 100% (QA)

To determine the optimal order quantity we need to use the economic order quantity EOQ form... View the full answer