The Assumptions of the Production Order Quantity Model Are Met

question 144

Multiple Choice

The assumptions of the production order quantity model are met in a situation where annual demand is 3650 units, setup cost is $50, holding cost is $12 per unit per year, the daily demand rate is 10 and the daily production rate is 100. The production order quantity for this problem is approximately

• A) 139
• B) 174
• C) 184
• D) 365
• E) 548

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