Demand is 5000 units per year ordering costs are $100 per order and the basaic unit price is $5. carrying costs are 20% per annum. discounts are available thus:
1200 -1399 less 10%
1400 - 1499 less 15%
1500 and over less 20%
what is the most economical quantity to order?
A compan yuses a special bracket in the manufacturre of its products which it orders from outside suppliers. the appropriate data are:
demand =2000 per annum
order cost = $20 per order
carrying cost = 20% of item price
Basic item price = 10 per bracket
The company is offerred the follosing discounts on the basic price:
For order quantity 400-799 lesss 2%
800-1599 less 4%
1600 and over less 5%
youare required to establish the most economical quantity to order.
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