Bank Drugs sells Jami Michelle lipstick. Jami Michelle Company offers a 6% discount on orders of at least 500 tubes, a 10% discount on orders of at least 1000 tubes, a 12% discount on orders of at least 1800 tubes, and a 15% discount on orders at least 2500 tubes. Bank sells an average of 40 tubes of Jami Michelle lipstick weekly. The normal price paid by Bank Drugs is $1 per tube. If it costs Bank $30 to place an order and Bank's annual holding cost rate is 27%, determine the optimal order policy for Bank Drugs.

What will be an ideal response?


Bank Drugs should order 1000 tubes at a time.

Business

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Business

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Business