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# 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...

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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