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Sauron
2 months ago
14

For product W, a firm has an annual holding cost percentage of 20%, an ordering cost of $110 per order, and annual demand of 15,

000 units. The following price schedule applies to the firm's purchases.Units Ordered - Price Per Unit
1-250 - $30.00
251-500 - $28.00
501-750 - $26.00
751 and up - $25.00
What is the optimal order quantity?
Business
1 answer:
Scilla [3.8K]2 months ago
3 0
812.40 units. According to the information provided, the annual holding cost percentage is 20%, the ordering cost is $110 per order, and the annual demand stands at 15,000 units. The pricing schedule is as follows: 1-250 units at $30.00, 251-500 units at $28.00, 501-750 units at $26.00, and 751 units and above at $25.00. The optimal order quantity is calculated to be 812.40 units.
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