Question: An item ( a pharmaceutical compound ) has a unit cost of $ 3 0 . ( A unit is a 2 mg portion of
An item a pharmaceutical compound has a unit cost of $A unit is a mg portion of active ingredient plus an inert ingredient, plus a glass container Total usage for the year is units. Order costs are $ per order. The item is highly perishable and it must be stored at extremely cold temperatures, which is costly Your company uses an annual carrying cost of to account for the opportunity cost of capital, physical storage costs, and so on The supplier has given you the choice of ordering in quantities of or If you order in lots of the supplier will reduce your cost per unit to $
What is the order quantity that yields the lowest total acquisition cost?
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