RCBarker Makes Purchasing Decisions for His Company

question 81

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
• E)None of the above

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Definitions:

Executive Reality Checking

A process where business leaders periodically validate their strategies, assumptions, and actions against the actual business environment and outcomes.

Outside Consultants

Professional advisors who are not part of an organization but are hired to provide expertise and advice on specific matters.

Employee Dissatisfaction

A state of discontent experienced by employees due to various factors such as work environment, job demands, or lack of recognition.

Inadequate Control

A situation where there is insufficient management or oversight, leading to potential problems or failures within an organization.