Question: A lab is trying to determine how many test kits it should order from its supplier. They use 780 kits per year. The annual holding

A lab is trying to determine how many test kits it should order from its supplier. They use 780 kits per year. The annual holding cost is $3 per kit per year. The ordering cost is $15 per order. The supplier delivers their orders all at one time, but offers a quantity discount. What is the optimum condition (order quantity) and total cost (ordering, holding and item cost)? Draw the Order quantity (Q) verses Total Annual Cost graph with 3 item prices.

Quantity	Price
1-72	60
73-144	56
145 and more	53

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