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( 2 0 points ) A manufacturer plans to use a state - of - the - art circuit board in assembling a number of
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A manufacturer plans to use a stateoftheart circuit board in assembling a number of consumer products. It is
estimated that this item will have a uniform usage rate of units per month. The fixed cost for an average
purchase order is $order and the firm's inventory holding cost rate is $ year. The technical sourcing
manager has identified two vendors as potential suppliers for this item. The following table shows the necessary
data for selecting the most desirable supplier:
Based on the relevant costs alone, which one of these two vendors should be selected for supplying the inventory
item in question? What are the order size and the annual total relevant cost resulting from your choice? In addition
to costs, what other noneconomic factors should be considered in this vendor selection problem?
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