The mythical Owen Distributors has an annual demand of 2,000 units for its handheld security wands. The
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The mythical Owen Distributors has an annual demand of 2,000 units for its handheld security wands. The average cost of the handheld security wand is US$140. Carrying cost is 18% of the unit cost of the security wand. Ordering costs are US$30 per order. If the company orders in quantities of 500 or more, it can get a 6% discount on unit cost of the security wand. Should Owen Distributors take the quantity discount?
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Operations Management Managing Global Supply Chains
ISBN: 978-1506302935
1st edition
Authors: Ray R. Venkataraman, Jeffrey K. Pinto
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