Daniel Has Computed the EOQ for a Product He Sells

question 5

Multiple Choice

Daniel has computed the EOQ for a product he sells to be 400 units.However, due to recent events he has a cash flow problem.Therefore, he orders only 100 units each time he places an order.Which of the following is true for this situation?

• A)Annual ordering cost will be lower than annual holding cost.
• B)Annual ordering cost will be higher than annual holding cost.
• C)Annual ordering cost will equal annual holding cost.
• D)Annual ordering cost will be unaffected by the order policy change.

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Definitions:

Windows Operating System

A family of graphical operating systems developed, marketed, and sold by Microsoft, used widely on personal computers and servers.

Kernel

The core component of a computer's operating system that manages communications between hardware and software.

Processor

The central processing unit (CPU) of a computer, responsible for performing calculations and tasks that allow the computer to operate.

System Components

The individual hardware parts that make up a computer system, such as the CPU, memory, and storage devices.