Question: A stonecutter uses about 1 9 , 5 0 0 pounds of stone each week. The stonecutter estimates their holding cost to be 3 9

A stonecutter uses about 19,500 pounds of stone each week. The stonecutter estimates their holding cost to be
39% per year. A supplier has offered the stonecutter two options. Option 1 is to purchase stone in lots of 35,000
pounds (truckload). The price per pound for option 1 is $0.63 per pound. Option 2 is to have stone delivered by rail.
The cost per pound for option 2 would be $0.57 per pound. Deliveries by rail will include 150,000 pounds of stone.
In either case, the supplier will charge the firm a fixed fee of $475 per delivery.
What is the total annual (52 week) holding and ordering cost of option 2?
Note: Round your answer to 2 decimal places.
 A stonecutter uses about 19,500 pounds of stone each week. The

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