Question

Based on your experience in the company you know that fixed costs are about 20 percent. Also, as per your calculations, it will cost around $75 to place an order with super suppliers. Quoted delivery lead time is four weeks. So, you will have to arrange for extra storage space. Super suppliers has an excellent track record and so there is no need to carry safety stock, but you need to decide the order quantity. Also, keep in mind that the decision is acceptable only if you can cut down costs by outsourcing. Analyse the situation and make a recommendation

Answer 1

Answer:

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