Amco Convenience Store purchases 500 hammers a year for its inventory from its supplier, who offers pricing at quantity discounts. The quantities and pricing from this supplier are shown in the following table:

The cost for Amco to place an order is $60, and the cost to store a hammer in inventory for a year is $15. What quantity should Amco order?

 

Transcribed Image Text:

ORDER QUANTITY UNIT PRICE 0-149 $12.00 150-349 SI1.50 350-599 S10.50 600 or more $ 9.80 ORDER QUANTITY UNIT PRICE 0-149 $12.00 150-349 SI1.50 350-599 S10.50 600 or more $ 9.80

Answer rating: 100% (QA)

Answer DEMAND 500 HOLDING COST 2 ORDERING COST 60 EOQ SQRT2DSH EOQ SQRT 2 500 60 2 173 Now in order ... View the full answer