Posted: September 14th, 2022

Mail order

Problem 13-13

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A mail-order house uses 16,820 boxes a year. Carrying costs are 60 cents per box a year, and ordering costs are $96. The following price schedule applies.

 

Number of Boxes Price per Box
1,000 to 1,999 $1.25                
2,000 to 4,999 1.20                
5,000 to 9,999 1.15                
10,000 or more 1.10                

 

a.

Determine the optimal order quantity. (Round your answer to the nearest whole number.)

 

  Optimal order quantity [removed] boxes  

 

b.

Determine the number of orders per year. (Round your answer to 2 decimal places.)

 

  Number of order [removed] per year  

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