What order quantity minimizes total annual inventory cost
A computer company sells peripherals, like printers and scanners, with their new desktop and laptop computers.
Their source for printers charges $300 per order, and holding cost is 16% of the unit price.
They sell 100 printers per month. The manufacturer has offered the following price schedule.
What order quantity minimizes total annual inventory cost?
Order Quantity Price Per Unit
0 to 11 520
12 to 143 500
144 or more 400
Please provide detailed answer. Step by step and all the equations used, will be highly appreciated.
A computer company sells peripherals, like printers and scanners, with their new desktop and laptop computers.
Their source for printers charges $300 per order, and holding cost is 16% of the unit price.
They sell 100 printers per month. The manufacturer has offered the following price schedule.
What order quantity minimizes total annual inventory cost?
Order Quantity Price Per Unit
0 to 11 520
12 to 143 500
144 or more 400
Please provide detailed answer. Step by step and all the equations used, will be highly appreciated.
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