Forecasts show that 10,000 units need to be purchased on an annual basis. The producer offers...

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Forecasts show that 10,000 units need to be purchased on an annual basis. The producer offers a sliding price scale based on the quantity in each order, as follows. Ordering Cost per year for orders up to 300 units is $1000 (Note: ordering costs per year for other order sizes are not needed). Holding cost is 20% of unit price. Order Quantity Unit Price 1-300 $40 301-1000 $35 1000+ $32 Determine the optimal order quantity. Forecasts show that 10,000 units need to be purchased on an annual basis. The producer offers a sliding price scale based on the quantity in each order, as follows. Ordering Cost per year for orders up to 300 units is $1000 (Note: ordering costs per year for other order sizes are not needed). Holding cost is 20% of unit price. Order Quantity Unit Price 1-300 $40 301-1000 $35 1000+ $32 Determine the optimal order quantity.

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Annual demand is 10000 units Ordering costs for orders up to 300 units is 1000 Holding cos... View the full answer