Question: Samsung's mobile communications division uses 2 0 , 0 0 0 memory chips per month. Their trucking company charges Samsung $ 3 0 0 per

Samsung's mobile communications division uses 20,000 memory chips per month. Their trucking company charges Samsung $300 per shipment, independent of the quantity purchased. The manufacturer of the memory chips offers an all unit quantity discount with a price of $1 per memory chip for orders under 18,000 units, $0.96 per chip for orders between 18,000 and 36,000 units (including 18,000 and excluding 36,000), and $0.92 per chip for orders 36,000 units and larger. Samsung incurs a holding cost rate of 15% per year. What is the optimal lot size and optimal total cost (TC*) for Samsung?
B. Q*=43,000, TC*= $362,293
C. Q*=36,000, TC*= $203,518
D. Q*=36,000, TC*= $225,284

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