The local Hospital purchasing manager was contacted

Question # 00351204 Posted By: rey_writer Updated on: 08/02/2016 02:43 AM Due on: 08/02/2016
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The local Hospital purchasing manager was contacted by new supplier, who offered a quantity discount for disposable syringes. The order cost for the item is $80 per order and holding cost is 25 % of average inventory value on an annual basis. Annual demand is 40,000 boxes at a constant rate (no seasonality).

The Hospital currently pays $80 per box of for syringes. However, the new supplier offered a $4-per-box discount if the hospital would order a minimum of 2,000 boxes at a time.

  1. Should the hospital take advantage of this offer?
  2. Show a comparative analysis of all costs in the two alternatives; with discount and without discount); Show detail of your work.
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  1. Tutorial # 00346806 Posted By: rey_writer Posted on: 08/02/2016 02:46 AM
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