Which supplier should the school choose to buy the notebook

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Reference no: EM133621328

Assignment:

A school is considering to purchase notebooks from one of three potential suppliers. Supplier A will sell the notebook for $2:00 per notebook, independent of the number of notebooks ordered. Supplier B will sell the notebooks for $1:96 each but will not consider an order for fewer than 2; 500 notebooks, and Supplier C will sell the notebooks for $1:94 each but will not accept an order for fewer than 5;000 notebooks. Assume an order setup cost of $50 and an annual requirement of 40;000 notebooks. The annual holding cost for one notebook is $1:00. Which supplier should the school choose to buy the notebook? How many notebooks should be purchased each time in order to minimize the total annual inventory cost?

Reference no: EM133621328

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