Demand for phones at Amazon is 5,000 per month. The holding cost as Amazon is 25 percent and the company incurs a fixed cost of $500 for each order placed. the supplier offers a marginal unit quantity discount with a price of $200 per phone for the first 10,000 phones in an order, a price of $195 for the next 10,000 phones in the order, an a price of $190 for the quantity above 20,000 in the order. How many phones should amazon order per replenishment??

Purchasing and Supply Chain Management
6th Edition
ISBN:9781285869681
Author:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Chapter2: The Purchasing Process
Section: Chapter Questions
Problem 1GPE
icon
Related questions
icon
Concept explainers
Topic Video
Question

Please do not give solution in image formate thanku.

Demand for phones at Amazon is 5,000 per month. The holding cost as Amazon is 25 percent and the company incurs a fixed cost of $500 for each order placed. the supplier offers a marginal unit quantity discount with a price of $200 per phone for the first 10,000 phones in an order, a price of $195 for the next 10,000 phones in the order, an a price of $190 for the quantity above 20,000 in the order. How many phones should amazon order per replenishment??

(Please include formulas used)

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 4 images

Blurred answer
Knowledge Booster
Inventory management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning