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Bamazon Inc's demand for a product is 15 units per month. Its supplier charges an ordering cost of $5 per order and $10 per unit with a 10% discount...

Bamazon Inc's demand for a product is 15 units per month. Its supplier charges an ordering cost of $5 per order and $10 per unit with a 10% discount for orders of 15 units or higher. Bamazon Inc. incurs a 25% annual holding cost. Assuming the firm operates optimally, how many units should they purchase each time they place an order?

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This is calculated as: EOQ= Square root of (2*Demand*H. Costs)/($10*0.1*15 + $1.25). Demand= 15 units Ordering cost = $5... View the full answer

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