Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Chris Sandvig Irrigation, Inc., has summarized the price list from four potential suppliers of an underground control
valve. See the table below. Annual usage is 1,000 valves; order cost is $13 per order; and annual inventory holding
costs are $2.15 per unit.
Vendor A
Vendor B
Vendor C
Vendor D
Quantity
Price
Quantity
Price
Quantity
Price
Quantity
Price
1-49
$35.00
1-74
$34.75
1-99
$34.50
1-199
$34.25
50-74
34.75
75-149
34.00
100-199
33.75
200-399
33.00
75-149
33.55
150-299
32.80
200-399
32.50
400+
31.00
150-299
32.35
300-499
31.60
400+
31.10
300-499
31.15
500+
30.50
500+
30.75
Which vendor should be selected and what order quantity is best if Sandvig Irrigation wants to minimize total cost?
Chris Sandvig Irrigation should order
units at a time from
(enter your response as a whole number).
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Transcribed Image Text:Chris Sandvig Irrigation, Inc., has summarized the price list from four potential suppliers of an underground control valve. See the table below. Annual usage is 1,000 valves; order cost is $13 per order; and annual inventory holding costs are $2.15 per unit. Vendor A Vendor B Vendor C Vendor D Quantity Price Quantity Price Quantity Price Quantity Price 1-49 $35.00 1-74 $34.75 1-99 $34.50 1-199 $34.25 50-74 34.75 75-149 34.00 100-199 33.75 200-399 33.00 75-149 33.55 150-299 32.80 200-399 32.50 400+ 31.00 150-299 32.35 300-499 31.60 400+ 31.10 300-499 31.15 500+ 30.50 500+ 30.75 Which vendor should be selected and what order quantity is best if Sandvig Irrigation wants to minimize total cost? Chris Sandvig Irrigation should order units at a time from (enter your response as a whole number).
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