Part II $(80\%)$: Please answer all questions and write down your answers in

the provided spaces.

A company will begin stocking remote control devices. Expected monthly demand is $800$

units. The controllers can be purchased from either supplier A or supplier B$.($Note that you

are only allowed to purchase from one supplier.$)$ Ordering cost is $$40$ and annual holding

cost is $25$ percent of unit price per unit. Which supplier should be used and what is the

optimal order quantity if the intent is to minimize total annual costs? $($round the optimal

order quantity to the nearest integer$)$

Their price lists are as follows:

$D=80012=9600$

Solution:

$D=(800)(12)=9600$ units

$S=$$$40$

$H=(25\%)P$

For Supplier A: