Homework Help is Here – Start Your Trial Now!
Business
Operations Management
A computing company manufacturers an inexpensive audio card (Audio Max) for assembly into several moderls of its microcomputers. The annual demand for this part is 600 units. The cost of preparing an order and making production set up is S = $20/order, while the unit holding cost per year is equal to 30% of the item price. The supplier has now offered the computing comapny the following quantity discount schedule. What should the order quantity be in order to minimize the annual total cost

A computing company manufacturers an inexpensive audio card (Audio Max) for assembly into several moderls of its microcomputers. The annual demand for this part is 600 units. The cost of preparing an order and making production set up is S = $20/order, while the unit holding cost per year is equal to 30% of the item price. The supplier has now offered the computing comapny the following quantity discount schedule. What should the order quantity be in order to minimize the annual total cost

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
See similar textbooks
icon
Related questions
Question

A computing company manufacturers an inexpensive audio card (Audio Max) for assembly into several moderls of its microcomputers. The annual demand for this part is 600 units. The cost of preparing an order and making production set up is S = $20/order, while the unit holding cost per year is equal to 30% of the item price. The supplier has now offered the computing comapny the following quantity discount schedule. What should the order quantity be in order to minimize the annual total cost?

Quantity Price 1 to 49 50 to 249 250 and up $5.00 per unit $4.50 per unit $4.10 per unit
Transcribed Image Text:Quantity Price 1 to 49 50 to 249 250 and up $5.00 per unit $4.50 per unit $4.10 per unit
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 4 steps with 3 images

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Follow-up Questions
Read through expert solutions to related follow-up questions below.
Follow-up Question

Why was answer 500? Shouldnt it be 250? How did you get quantities on the left hand column of 49 and 250?

Solution
Bartleby Expert
SEE SOLUTION
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Business in Action
Business in Action
Operations Management
ISBN:
9780135198100
Author:
BOVEE
Publisher:
PEARSON CO
Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.
SEE MORE TEXTBOOKS