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The operator of a concession at a downtown location estimates that he will sell 400 bags of circus peanuts during a month. Carrying costs are
The operator of a concession at a downtown location estimates that he will sell 400 bags of circus peanuts during a month. Carrying costs are 17 percent of unit price and ordering cost is $22. The price schedule for bags of peanuts is: 1 to 199, $1.00 each; 200 to 499, $.94 each; and 500 or more $.87 each. What order size would be most economical?
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