Question 5: EOQ with Quantity Discounts (25 points) A smart TV manufacturer purchases panels from a supplier. The need for panels is constant throughout the year and equals 250,000 panels per year. The yearly interest rate is estimated to be 25%. The fixed cost of ordering panels from the supplier is $5,000. Suppose that the supplier offers the following discount scheme: If the producer orders less than 10,000, the unit cost is $100. If the producer orders 10,000 units or more, then the cost per panel is $80; and if the producer orders 12,000 units or more, then the cost per panel is $60. a. [15 points] What is the economic order quantity of panels and the total annual cost? What is the order cycle length in months? (There are 12 months in one year.) b. [10 points] The contract with the supplier dictates that the producer can place an order only in multiples of 5000 panels. How would this change the panel ordering policy of the producer? By what percentage does the total annual holding and setup costs change for the producer? Question 5: EOQ with Quantity Discounts (25 points) A smart TV manufacturer purchases panels from a supplier. The need for panels is constant throughout the year and equals 250,000 panels per year. The yearly interest rate is estimated to be 25%. The fixed cost of ordering panels from the supplier is $5,000. Suppose that the supplier offers the following discount scheme: If the producer orders less than 10,000, the unit cost is $100. If the producer orders 10,000 units or more, then the cost per panel is $80; and if the producer orders 12,000 units or more, then the cost per panel is $60. a. [15 points] What is the economic order quantity of panels and the total annual cost? What is the order cycle length in months? (There are 12 months in one year.) b. [10 points] The contract with the supplier dictates that the producer can place an order only in multiples of 5000 panels. How would this change the panel ordering policy of the producer? By what percentage does the total annual holding and setup costs change for the producer