Question: Consider the quantity discount schedule below. The annual demand is 90,000 units, setup cost is $1000 per order, and annual holding cost is $10 per
Consider the quantity discount schedule below. The annual demand is 90,000 units, setup cost is $1000 per order, and annual holding cost is $10 per unit.
What order quantity per order minimizes the total cost of inventory?
| Quantity Ordered | Price Per Unit |
| 11999 | $300 |
| 20003999 | $280 |
| 40005999 | $250 |
| 6000 and over | $210 |
Step by Step Solution
There are 3 Steps involved in it
1 Expert Approved Answer
Step: 1 Unlock
Question Has Been Solved by an Expert!
Get step-by-step solutions from verified subject matter experts
Step: 2 Unlock
Step: 3 Unlock
