# Steamy Speedboats has an annual demand for 1,500 speedboats. Its supplier offers quantity discounts to promote larger order quantities. The cost to place an order is \$300, and the holding rate is 32 percent of the purchase cost. The purchase cost for each speedboat is based on the price schedule given below. Compute the (a) optimal order quantity, (b) annual purchase cost, (c) annual holding cost, (d) annual order cost, and (e) total annual inventory cost. ORDER QUANTITY PRICE PER UNIT 1–50 \$18,500 51–100 \$18,000 101–150 \$17,400 151 and above \$16,800

. Icy Snowmobile, Inc., has an annual demand for 1,200 snowmobiles. Their purchase
cost for each snowmobile is \$2,500. It costs about \$250 to place an order, and the
holding rate is 35 percent of the unit cost. Compute the (a) EOQ, (b) annual holding
cost, (c) annual order cost, and (d) total annual inventory cost.
8. Steamy Speedboats has an annual demand for 1,500 speedboats. Its supplier offers
quantity discounts to promote larger order quantities. The cost to place an order is
\$300, and the holding rate is 32 percent of the purchase cost. The purchase cost for
each speedboat is based on the price schedule given below. Compute the (a) optimal
order quantity, (b) annual purchase cost, (c) annual holding cost, (d) annual order
cost, and (e) total annual inventory cost.
ORDER QUANTITY PRICE PER UNIT
1–50 \$18,500
51–100 \$18,000
101–150 \$17,400
151 and above \$16,800

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