What is the optimal order quantity

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Firm C’s demand for a product is 60 units per month. Its supplier charges an ordering cost of $40 per order and $35 per unit with a 20% discount for orders of 100 units or more. Orders must be placed in integer multiples of 100 units. Firm C incurs a 20% annual holding cost. What is the optimal order quantity that minimizes the total purchasing, ordering, and holding cost?

Reference no: EM131747081

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