Question: A stonecutter uses about 1 6 , 5 0 0 pounds of stone each week. The stonecutter estimates their holding cost to be 3 3
A stonecutter uses about pounds of stone each week. The stonecutter estimates their holding cost to be per year. A supplier has offered the stonecutter two options. Option is to purchase stone in lots of pounds truckload The price per pound for option is $ per pound. Option is to have stone delivered by rail. The cost per pound for option would be $ per pound. Deliveries by rail will include pounds of stone. In either case, the supplier will charge the firm a fixed fee of $ per delivery.
What is the total annual week holding and ordering cost of option
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