Now clearly we would try to find the payments at each level case 1 : 2 suppliers

Question

Now clearly we would try to find the payments at each level

case 1 : 2 suppliers :

Payment by manufacturer (to supplier) = 40.70/1.7 = $ 23.94

(assuming a 70% markup as no values are given, If it is missed out, kindly replace 1.7 by that value eg -0% markup would be 1.0, 10% would be 1.1, 20% would be 1.2, 30% would be 1.3 etc)

Case 2: 1 supplier :

The manufacturer would get a 30% discount in this case thus his payment to supplier would be $ 23.94*.7 = $ 16.76

So he should definitely opt for a single supplier (all other factors remaining constant and no constraints on supply)

Explanation / Answer

Based on the cost point of the bill of material, should the manufacturer opt for one or two suppliers (show costs). The 2x quantity discount is 30%. Pays the Required % Supply ChainNode Below Mark-up Nodes Consumer Retailer Wholesaler Exporter Manufacturer $200 70% 70% 70% | 70% Cost of the B of M 1 Supplier 2 Suppliers

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