Problem 20-39 (Algo)CU, Incorporated (CUI), produces copper contacts that it uses in switches and relays. CUI needs to determine the order quantity, Q, to meet the annual demand at the lowest cost. The price of copper depends on the quantity ordered. Here are price-break and other data for the problem: Price of copper$0.84per pound up to 2,499 pounds $0.83per pound for orders between 2,500 and 4,999 pounds $0.81per pound for orders 5,000 pounds or greaterAnnual demand 54,000pounds per yearHolding cost 25percent per unit per year of the price of the copperOrdering cost$30 Which quantity should be ordered? Quantity_____________pounds

Economic Order Quantity is a technique which helps to identify the optimal order quantity using…

Answered: CU, Incorporated (CUI), produces copper…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Problem 20-39 (Algo)

CU, Incorporated (CUI), produces copper contacts that it uses in switches and relays. CUI needs to determine the order quantity, Q, to meet the annual demand at the lowest cost. The price of copper depends on the quantity ordered. Here are price-break and other data for the problem:


Price of copper	$	0.84	per pound up to 2,499 pounds
	$	0.83	per pound for orders between 2,500 and 4,999 pounds
	$	0.81	per pound for orders 5,000 pounds or greater
Annual demand		54,000	pounds per year
Holding cost		25	percent per unit per year of the price of the copper
Ordering cost	$	30