Question: Alex wants to determine the best order quantity for mechanical pencils. He buys the mechanical pencils from a wholesaler. The wholesaler offers discounts for large

Alex wants to determine the best order quantityAlex wants to determine the best order quantityAlex wants to determine the best order quantity

Alex wants to determine the best order quantity for mechanical pencils. He buys the mechanical pencils from a wholesaler. The wholesaler offers discounts for large orders. He expects an annual demand of 2,500 units. It costs $10 to place an order. The annual cost of holding a unit in stock is 30 percent of the unit's price. The price schedule that the wholesaler offers is shown in the table below. Answer the following questions. Round to four decimal places. What is the best order quantity? 245 480 500 What is the total annual cost associated with the best order quantity? 7775.0000 8437.9437 9378.1468

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