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A company will begin stocking remote control devices. The expected monthly demand is 800 units. The controllers can be purchased from either supplier A or
A company will begin stocking remote control devices. The expected monthly demand is 800 units. The controllers can be purchased from either supplier A or supplier B. Their price lists are as follows: SUPPLIER A SUPPLIER B Quantity Unit Price Quantity Unit Price 1 199 $14.00 1 149 $14.10 200-499 13.80 150-349 13.90 500+ 13.60 350+ 13.70 The ordering cost is $40 and the annual holding cost is 25 percent of the unit price. Which supplier should be used and what order quantity is optimal if the intent is to minimize total annual cost
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