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A manager just received a new price list from a supplier. It will now cost $ 1.8 a box for quantities of 1001 or more boxes, $1.9 a box for 401 to 1000 boxes, and $2.0 a box for smaller quantities. Ordering cost is $10 per order and carrying costs are 40% of cost per box a year. The firm uses 8000 boxes a year. What order size would you recommend? What is the total cost associated with this order size?

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Operation Management, Management Studies

Category:- Operation Management
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