To boost sales, Pfisher announces a new price structure for disposable surgical

Question

To boost sales, Pfisher announces a new price structure for disposable surgical packages. Although the price break no longer is available at 200 units, Pfisher now offers an even greater discount if larger quantities are purchased. On orders of 1 to 599 packages the price is $50.35 per package. For orders of 600 or more, the price per unit is $47.80. Ordering costs, annual holding costs: and annual demand remain at S6Sper order, 20 percent of the per-unit cost, and 480 packages per year, respectively. What is the new lot size? The new lot size is [ ] packages. (Enter your response rounded to the nearest whole number.)

Explanation / Answer

New lot size:

= (2×Annual requirement×buying cost per order÷Carrying cost per unit)^(1÷2)

= (2×480×$68÷($50.35×20%))^(1÷2)

= 81 packages

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.