Find the optimal order quantity and annual cost

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Reference no: EM13959100

A plant purchases 150,000 units of an electrical component per year. The fixed ordering cost is $60. The unit cost is $0.25 if ordered in quantities less than 1000, $0.24 if order size is between 1,000 and 15,000, and $0.23 for orders of 15,000 or more. The holding cost rate is 0.4 per year. Find the optimal order quantity and annual cost.

Reference no: EM13959100

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