Frontenac Corporation Has Just Developed a New On-Line Ordering System

question 14

Multiple Choice

Frontenac Corporation has just developed a new on-line ordering system with their primary supplier.They expect the new system to reduce their average number of days of inventory on hand from 42 days to 22 days.If their cost of goods sold was $642,000 last year and is expected to be about the same this year, how much smaller should their investment in inventory be this year?

• A)$15,285
• B)$32,100
• C)$35,178
• D)$38,695

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Definitions:

Thorndike

An American psychologist known for his work on learning theory and the law of effect, which suggested that behaviors followed by satisfying outcomes are likely to be repeated.

Stimulus

Any event or situation that evokes a response from an organism.

Systematic Desensitization

A behavioral therapy technique used to reduce phobic responses or anxiety through gradual exposure to the feared object or situation coupled with relaxation exercises.

Counterconditioning

A behavioral therapy technique that involves teaching the patient to associate a positive response with a stimulus that previously elicited a negative response.