A plant purchases 150000 units of an electrical component, Ask an Expert

Management Studies

A plant purchases 150,000 units of an electrical component per year. The fixed ordering cost is $60. The unit cost is $0.25 if ordered in quantities less than 1000, $0.24 if order size is between 1,000 and 15,000, and $0.23 for orders of 15,000 or more. The holding cost rate is 0.4 per year. Find the optimal order quantity and annual cost.

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91628053

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