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  3. a jewelry firm buys semiprecious stones to make br

A jewelry firm buys semiprecious stones to make bracelets and rings. The supplier quotes a price...

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General Management

A jewelry firm buys semiprecious stones to make bracelets andrings. The supplier quotes a price of $8.20 per stone forquantities of 600 stones or more, $8.70 per stone for orders of 400to 599 stones, and $10 per stone for lesser quantities. The jewelryfirm operates 214 days per year. Usage rate is 25 stones per day,and ordering costs are $48.

a.

If carrying costs are $2 per year for each stone, find the orderquantity that will minimize total annual cost. (Round yourintermediate calculations and final answer to the nearest wholenumber.)


  Order quantitystones


b.

If annual carrying costs are 27 percent of unit cost, what isthe optimal order size? (Round your intermediatecalculations and final answer to the nearest wholenumber.)


  Optimal ordersizestones


c.

If lead time is 5 working days, at what point should the companyreorder?


  Reorderquantitystones

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