What is the associated average total annual cost

Assignment Help Business Economics

Reference no: EM13996171

Demand for phones at an on-line retailer is 5,000 per month. The annual inventory carrying rate for the retailer is 25 percent, and the retailer incurs a fixed order cost of $15,000 for each order placed with the supplier in Taiwan. The supplier offers a price of $100 per phone for any order that is strictly less than 5,000 phones in the order, a price of $95 if the order size is greater than or equal to 5,000 but strictly less than 10,000 phones in the order and a price of $90 if the order size is greater than or equal to 10,000.

a) How many phones should the retailer order per replenishment if an all-units discount policy is in effect? And, what is the associated average total annual cost?

b) How many phones should the retailer order per replenishment if an incremental units discount policy is in effect? And, what is the associated average total annual cost?

Reference no: EM13996171

Questions Cloud

What is the effect of the sale of the a corporation shares : What is the effect of the sale of the A Corporation shares and the purchase of the C Corporation shares on Harlon's 2012 pretax earnings?

Social security and medicare for the elderly : Social Security Do you think the federal government should increase spending on Social Security and Medicare for the elderly? If not, how should the elderly fund retirement and medical costs? Provide research support for your positions.

Important part of studying for organic chemistry 2 : What is the most important part of studying for organic chemistry 2?

State government levy tariffs on imports : Why not have State governments levy tariffs on imports, or tax other states' products. Would this be a sensible way to raise revenues? What are the advantages/disadvantages? Provide research support for your positions

What is the associated average total annual cost : Demand for phones at an on-line retailer is 5,000 per month. The annual inventory carrying rate for the retailer is 25 percent, and the retailer incurs a fixed order cost of $15,000 for each order placed with the supplier in Taiwan. How many phones s..

Change the current floating exchange rate regime : Suppose that a conservative political alliance succeeds in 2020 to change the current floating exchange rate regime in the U.S. into a fixed exchange rate regime. Assume that the fixed exchange rate is announced to be equal to the current market equi..

Reasonable nucleophile in a sn2 reaction : Which of the following would not be a reasonable nucleophile in a SN2 reaction?

Assume significant influence was acquired : Assume significant influence was acquired. Prepare the appropriate journal entries from the purchase through the end of the year.

Problem for private-value auctions : Explain the nature of the winner’s curse and why it occurs in a common-value auction. Why the winner is’s cursing not a problem for private-value auctions?

User Account

All Pages