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Holding cost is $0.10 per ball on an annual basis

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Reference no: EM13693106

Estimated demand for customized golf balls at William's company is 60,000 a year. William has indicated that ordering cost is $105, and that the following price schedule applies: 1 to 5,999 balls, $.90 each; 6,000 to 11,999 balls, $.80 each; and 12,000 or more, $.75 each. What order size will minimize total cost in each of these cases:
(i) Holding cost is $0.10 per ball on an annual basis.
(ii) Holding cost is 10 percent of price on an annual basis.

Reference no: EM13693106

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