Question: Problem 3: Price-Break Problem (9 points) A product has an annual demand of 73,000 units. The annual holding cost for one unit is estimated to

Problem 3: Price-Break Problem (9 points) A product has an annual demand of 73,000 units. The annual holding cost for one unit is estimated to be 25% of the unit's cost. Each order costs the company $500. The supplier has offered the company the following prices based on the quantity ordered each time. Order Quantity Price 1-5,499 $10.90 5,500-5,999 $10.20 6,000+ $9.90 a What is the EOO for the $9.90 price? (2 points) b) Is the EOQ you found In part a) feasible or not feasible? (1 point) c Calculate the total costs for the lowest feasible quantity and all lower prices. (Hint: see Chapter 11 slide 34) (4 points) dj How many units should be ordered each time? (2 points)
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