In a Single-Period Model, If Shortage and Excess Costs Are

question 81

Multiple Choice

In a single-period model, if shortage and excess costs are equal, then the optimum service level is:

• A)0
• B).33
• C).50
• D).67
• E)none of these

---

Definitions:

Interest Rate

The percentage of a sum of money charged for its use, serving as the cost of borrowing or the return on savings.

Expected Rate

A forecasted value or percentage in various contexts, such as return on investment or growth, based on current and historical data.

Total Investment

The sum of all expenditures on capital goods by a business or economy during a specific period, indicating the total amount spent on investments.

Expected Flow

An estimation of the quantity of a commodity, cash, or traffic moved in a certain direction over a given period.