Scenario 11.4 - Caffeine and Sugar
With a fixed cost of $100 per order,Nathan decided it was vital to get his money's worth.His monthly demand for energy drinks was 10,000 bottles and holding cost was estimated at 20% of unit cost.The mail order company offered him a couple of possibilities - he could pay $4.00 per bottle for orders of up to 10,000 bottles.After that threshold,he would pay only $3.98 per bottle,and if he ordered 20,00 or more bottles in an order,he would pay only $3.96 per bottle.
-What is the best total cost that Nathan can incur?
A)$488,644
B)$492,780
C)$493,720
D)$484,382

Question

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The Answer of Scenario 11.4 - Caffeine and Sugar
With a fixed cost of $100 per order,Nathan decided it was vital to get his money's worth.His monthly demand for energy drinks was 10,000 bottles and holding cost was estimated at 20% of unit cost.The mail order company offered him a couple of possibilities - he could pay $4.00 per bottle for orders of up to 10,000 bottles.After that threshold,he would pay only $3.98 per bottle,and if he ordered 20,00 or more bottles in an order,he would pay only $3.96 per bottle.
-What is the best total cost that Nathan can incur?
A)$488,644
B)$492,780
C)$493,720
D)$484,382