Consider the grocery store where 4200 packages of paper towels are sold each year. The fixed...
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Consider the grocery store where 4200 packages of paper towels are sold each year. The fixed ordering cost for a batch purchase of paper towels is $100 and the yearly inventory holding cost is 30% of the purchase price. Suppose that the supplier offers the following price schedule based on the all-unit quantity discount policy: Quantity Purchased 1-499 500-999 1000+ Cost per Package $2.55 $2.50 $2.45 What is the optimal order quantity? What is the total inventory management cost? Consider the grocery store where 4200 packages of paper towels are sold each year. The fixed ordering cost for a batch purchase of paper towels is $100 and the yearly inventory holding cost is 30% of the purchase price. Suppose that the supplier offers the following price schedule based on the all-unit quantity discount policy: Quantity Purchased 1-499 500-999 1000+ Cost per Package $2.55 $2.50 $2.45 What is the optimal order quantity? What is the total inventory management cost?
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Related Book For
Operations Management Managing Global Supply Chains
ISBN: 978-1506302935
1st edition
Authors: Ray R. Venkataraman, Jeffrey K. Pinto
Posted Date:
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