Quantity would give store the lowest total acquisition cost

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Reference no: EM131279352

A store buys t-shirts from a supplier in China. The supplier offers the following purchasing options to the store:

Quantity ordered: [1-2,499], [2500 or more]

Unit Price: $35 (for 1-2,499), $32 (for 2500 or more)

The store sells 500,000 t-shirts each year. The annual carrying cost of t-shirts is 25%, and the ordering cost is $40. What order quantity would give the store the lowest total acquisition cost? Show your process.

Reference no: EM131279352

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