Question: Bell Computers purchases integrated chips at $ 350 per chip. The holding cost is $ 34 per unit per year, the ordering cost is $

Bell Computers purchases integrated chips at

$350

per chip. The holding cost is

$34

per unit per year, the ordering cost is

$121

per order, and sales are steady at

405

per month. The company's supplier, Rich Blue Chip Manufacturing, Inc., decides to offer price concessions in order to attract larger orders. The price structure is shown below.

Price Range Lower Quantity Upper Quantity Price/Unit

1 1 99 350

2 100 199 325

3 200 999999 300

Bell Computers purchases integrated chips at $

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