The manager of a large TV store wants to begin stocking a type of remote control device. Expected monthly demand is 800 units. The remote controls can be purchased from either supplier A or supplier B. Their price lists are as follows:

Ordering cost is $40 per order and annual holding cost is 25 percent of unit price. Which supplier should be used and what order quantity is optimal if the intent is to minimize total annual cost?

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Supplier A Supplier B Quantity Unit Price Quantity Unit Price $14.00 10.00 13.60 $14.10 13.90 13.70 1-199 1-149 200-499 500+ 150-049 350t