RCBarker Makes Purchasing Decisions for His Company

question 40

Multiple Choice

R.C.Barker makes purchasing decisions for his company.One product that he buys costs $50 per unit when the order quantity is less than 500.When the quantity ordered is 500 or more, the price per unit drops to $48.The ordering cost is $30 per order and the annual demand is 7,500 units.The holding cost is 10 percent of the purchase cost.How many units should R.C.order to minimize his total annual inventory cost? (Round your answer to the nearest unit.)

• A)300
• B)306
• C)500
• D)200

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Definitions:

Emotional Stress

A condition of strain on one's emotions caused by various factors, often leading to physical and psychological health issues.

Catastrophizing

The cognitive distortion that leads individuals to see an unfavorable outcome as the worst possible outcome, often far exceeding the actual situation.

Avoid-Avoid Inner Conflict

A psychological dilemma where an individual must choose between two undesirable options.

Ethnocentrism

The conviction that one's own ethnic group or culture is superior by nature, frequently coupled with a contempt for differing groups.