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Determine the number of orders per year

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Question - A mail-order house uses 16,190 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies.

Number of Boxes Price per Box

1,000 to 1,999 $1.25

2,000 to 4,999 1.20

5,000 to 9,999 1.15

10,000 or more 1.10

Required -

a. Determine the optimal order quantity.

b. Determine the number of orders per year.

Reference no: EM132772742

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