For a Certain Item, the Cost-Minimizing Order Quantity Obtained with the Basic

question 106

Multiple Choice

For a certain item, the cost-minimizing order quantity obtained with the basic EOQ model was 200 units and the total annual inventory (carrying and setup) cost was $600. The inventory carrying cost per unit per year for this item is

• A) $1.50
• B) $2.00
• C) $3.00
• D) $150.00
• E) not enough data to determine

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Definitions:

Cyclopentane

A cycloalkane with the molecular formula C5H10, consisting of a ring of five carbon atoms each connected with two hydrogen atoms, used as a solvent and in organic synthesis.

Cyclopentene

A cyclic hydrocarbon with the molecular formula C5H8, featuring a five-membered ring with one double bond.

Ammonia

A compound of nitrogen and hydrogen with the formula NH3, known for its pungent smell and use as a nitrogen source in fertilizers.

Triethylamine

A strong, organic base with the formula (C2H5)3N, used as a catalyst and solvent in chemical synthesis.