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(Solved) : Wt Company Needs Order Part Supplier Supplier Following Price Schedule Part Parts Cost 300 Q35297711

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Answer to The WT Company needs to order a part from a supplier. The supplier has the following price schedule for the part. The pa…

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The WT Company needs to order a part from a supplier. Thesupplier has the following price schedule for the part. The partscost $300 each for orders of 500 or fewer units; for orders between500 and 1,000 units, the first 500 cost $300 each and the remainingamount cost $290 each; for quantities of 1,000 and over the first500 cost $300 each, the next 500 cost $290 each, and the remainingamount cost $280 each. The accounting department estimates that thefixed cost of placing and order is $80, and holding costs are basedon a 20% annual interest rate. Assuming a monthly demand rate of150 units, what would be the optimal order quantity?

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