Question
The supermarket is evaluating the option of sourcing the 64 oz. cartons from an alternate supplier, supplier B. The holding cost for the 64 oz.
The supermarket is evaluating the option of sourcing the 64 oz. cartons from an alternate supplier, supplier B. The holding cost for the 64 oz. carton purchased from supplier B is also $1.50 per carton per year. The supermarket can purchase the 64 oz. cartons from supplier B at a price of $1.8/carton and supplier B charges a fixed delivery fee of $50 for every order. However, supplier B imposes the restriction that the supermarket can purchase the 64 oz. orange juice cartons only in multiples of 300. Given this restriction, should the supermarket source from supplier A or supplier B?
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