Question: A company will begin stocking remote control devices. Expected monthly 10 points demand is 800 units. The controllers can be purchased from either supplier A

A company will begin stocking remote control

A company will begin stocking remote control devices. Expected monthly 10 points demand is 800 units. The controllers can be purchased from either supplier A or supplier B. Their price lists are given in the attached image. Ordering cost is $40 and annual holding cost is 25 percent of unit price per unit. Which supplier should be used and what order quantity is optimal if the intent is to minimize total annual costs? SUPPLIER A SUPPLIER B Quantity Unit Price Quantity Unit Price 1-199 200-499 $14.00 13.80 13.60 1-149 150349 $14.10 13.90 13.70 500 + 350 +

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