Question: (This is the same problem as the previous one. The question is different.) The University Bookstore at a private university buys pencils from a wholesaler.

(This is the same problem as the previous one. The question is different.)

The University Bookstore at a private university buys pencils from a wholesaler. The wholesaler offers discounts for large orders according to the following price schedule:

Quantity Range Price per Unit
1-199 $3.90
200-599 $3.40
600+ $3.25

The bookstore expects an annual demand of 2,600 units. It costs $12 to place an order, and the annual cost of holding a unit in stock is 20% of the unit's price.

What will be the total purchasing cost if they order 150 pencils every time they contact the supplier? (round to two decimal places.)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!