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A University Orders All Office Supplies, Including Red Grading Pens

question 38

Multiple Choice

A university orders all office supplies, including red grading pens, out of a catalog from the same supplier. Conservative estimates of the demand for these red pens are 12,000 pens per year. There is a $25 charge for placing an order and the university has a $10 annual cost for holding these pens. Prices for the pens are based on the quantity purchased, so if less than 100 are ordered, the unit price is $2.50, if 100 to 299 are ordered, the unit price is $2.40, if 300 to 499 are ordered, the unit price is $2.30, and if 500 or more are ordered, the unit price is $2.20. What order quantity will result in the lowest total annual cost to the university?

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Definitions:

Could refer to myasthenia gravis, a chronic autoimmune neuromuscular disorder that causes weakness in the skeletal muscles.

Compresses

Pieces of material, often cloth, applied under pressure to a specific area of the body to relieve discomfort or stop bleeding.

Abdomen

The part of the body that contains the digestive organs, bounded by the diaphragm and the pelvis.

SOB

Stands for shortness of breath, a symptom in which a person finds it difficult to breathe or catch their breath, often indicative of respiratory or cardiac conditions.