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What is the optimum order size

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Reference no: EM131487736

A jewelry store buys semiprecious stones to make bracelets. The supplier quotes the following:

Number of Stones Price per Stone (P)

1-399 $10

400-599 $9

600+ $8

The supplier charges $48 for each order. Assuming the store's annual demand of 5000 stones, and the annual holding/carrying cost 30% of unit cost, what is the optimum order size (decide based on total cost)?

Reference no: EM131487736

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