Optimal order quantity, Determine the following: a. The

Optimal order quantity

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Reference no: EM13807928

A mail-order house uses 18,000 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

Determine the following:

a. The optimal order quantity.

b. The number of orders per year.

Reference no: EM13807928

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