A Shoe Business Meets the Qualifications for Using the Economic

question 29

Multiple Choice

A shoe business meets the qualifications for using the economic order quantity (EOQ) model.The business sells 20,000 pairs of shoes per year.Ordering costs for supplies are $12 per order.Holding costs are $0.96 per pair of shoes per year.What is the EOQ for this business?

• A) 500
• B) 708
• C) 1,667
• D) 19,200

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Definitions:

Potential GDP

The maximum output an economy can produce without causing inflation, when operating at full employment.

Government Budget

A financial statement presenting the government's proposed revenues and spending for a fiscal period, reflecting policy priorities and economic goals.

Annually Balanced Budget

A fiscal policy goal where government revenues and expenditures are equal within a one-year period, preventing deficit or surplus.

Great Depression

A major global financial crisis that occurred in the 1930s.