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Mr. Abdul buys wholesale and then retail sell disks that contain software packages that perform a variety of financial functions (NPV, IRR, etc.) used by
Mr. Abdul buys wholesale and then retail sell disks that contain software packages that perform a variety of financial functions (NPV, IRR, etc.) used by MBA students majoring in Finance. Depending on the quantity ordered, Mr. Abdul's unit cost is shown below. The annual demand is 2,000 units on the average. His ordering cost is $250. He estimates holding cost per year to be 10% of the unit cost. What is the quantity that Mr. Abdul should order to minimize Total inventory Cost? QUANTITY ORDERED UNIT COST ($) From 1 to 500 10.00 From 501 to 1000 9.00 From 1001 to 1500 8.00 From 1501 and above 7.00
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