The manager at Robert's Cigars wants to determine the lowest cost order policy given the following purchase discounts offered: cigar costs are $4 each for orders less than 500; $3.50 each for orders of 500 - 1000; and $3.25 each for orders greater than 1000.The order cost = $75, annual demand forecast = 5500 cigars, inventory carrying cost = 30% per year.
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Determine the 3 EOQ’s—
For $4 cig...
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