An Office Supply Company Is Attempting to Determine the Order

question 60

Multiple Choice

An office supply company is attempting to determine the order quantity for laser printer toner cartridges which are sold to local businesses. Annual demand is 20,000 units and each cartridge costs the store $25. It costs $30 to place an order and the inventory carrying cost rate is 25% of the value of the item. The following spreadsheet has been set up to solve the problem. What cell is the objective cell in this problem? $\begin{array}{|c|c|c|} \hline& \text { A } & \text { B } \\\hline 1 & & \\\hline 2 & & \\\hline 3 & \text { Annual Demand: } & 20,000 \\\hline 4 & & \\\hline 5 & \text { Cost per Unit: } & \$ 25 \\\hline 6 & \text { Ordering Cost: } & \$ 30 \\\hline 7 & \text { Carrying Cost: } & 25 \% \\\hline 8 & & \\\hline 9 & \text { Order Quantity: } & 483.73 \\\hline 10 & & \\\hline 11 & \text { Total Cost: } & \$ 502,738.61 \\\hline \end{array}$

• A) B3
• B) B7
• C) B9
• D) B11

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Definitions:

Targeting Markets

The process of identifying and focusing on specific segments of a broader market that a company wishes to sell to, often characterized by distinct needs, preferences, or demographic profiles.

Undifferentiated Targeting

A targeting strategy that approaches the marketplace as one large segment.

Differentiated Targeting

A targeting strategy that simultaneously pursues several different market segments, usually with a different strategy for each.

Niche Marketing

A targeting strategy that involves pursuing a large share of a small market segment.