Using the Fixed-Order-Quantity Model, What Is the Total Ordering Cost

question 3

Short Answer

Using the fixed-order-quantity model, what is the total ordering cost of inventory given an annual demand of 36,000 units, a cost per order of $40, and a holding cost per unit per year of $45? ______________________________________________.

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Definitions:

Supply

The total amount of a good or service available for purchase at all possible prices in a given market, at a given time.

Price

The price in terms of money that is predicted, necessary, or paid for an object.

Equilibrium Price

The price at which the quantity of goods suppliers are willing to produce equals the quantity of goods consumers are willing to buy.

Corn-based Ethanol

Ethanol produced from corn as a biomass through a fermentation process, primarily used as a biofuel additive for gasoline.