Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A mail-order house uses 16,800 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price

A mail-order house uses 16,800 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies.

Number of Boxes Price per Box
1,000 to 1,999 $1.25
2,000 to 4,999 1.20
5,000 to 9,999 1.15
10,000 or more 1.10

a.

Determine the optimal order quantity. (Round your answer to the nearest whole number.)

Optimal order quantity boxes

b.

Determine the number of orders per year. (Round your answer to 2 decimal places.)

Number of order per year

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Handbook Of The Economics Of Finance

Authors: George M. Constantinides, Milton Harris, Rene M. Stulz

1st Edition

044459406X, 978-0444594068

More Books

Students also viewed these Finance questions