Garner Is Your Sole Supplier of Gremmels, a Key Component

Essay

Garner is your sole supplier of gremmels, a key component in the Farfel unit your company produces and sells.Formerly, you ordered from Garner 800 units monthly, to meet an annual need (demand) for 9600 units.Purchase cost was $3.00 per unit.Now, however, Garner is offering discounts of 7% on orders of 1500 or more, and 15% on orders of 3000 units or more.Orders are placed and filled at a cost of $32 per order.Inventory holding cost is estimated at 20% of purchase cost, per item, per year.Under the new discount plan, what is your best strategy?