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Global Lawn, a manufacturer of lawn mowers, predicts that it will purchase 216,000 spark plugs next year. Global Lawn estimates that 18,000 spark plugs will
Global Lawn, a manufacturer of lawn mowers, predicts that it will purchase 216,000 spark plugs next year. Global Lawn estimates that 18,000 spark plugs will be required each month. A supplier quotes a price of 58.00 per spark plug. The supplier also offers a special discount option: If all 216,000 spark plugs are purchased at the start of the year, a discount of 2% off the $8.00 price will be given. Global Lawn can invest its cash at 10% per year. It costs Global Lawn $200 to place each purchase order. Read the requirements. Requirement 3. Should Global Lawn purchase 216,000 units at the start of the year or 18,000 units each month? Show your calculations. Begin by calculating the relevant costs for each alternative, then calculate the difference between the two alternatives
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