Which One of the Following Best Defines the Economic Order

question 64

Multiple Choice

Which one of the following best defines the economic order quantity (EOQ) ?

• A)Minimum size of an order needed to qualify for free shipping
• B)Minimum amount that must be ordered to obtain the quantity discount
• C)Number of items that are sold on average each month
• D)Restocking quantity that minimizes the total cost of inventory
• E)Minimal amount of inventory that must be purchased to receive a cash discount

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Definitions:

Long-Term Investments

Assets intended to be held for more than a year, such as bonds, stocks, or real estate, for generating revenue or appreciating in value.

Interest Income

Income earned from various types of investments that pay interest, such as bonds or savings accounts.

Trading Investments

Securities that are purchased by a firm primarily for the purpose of selling them in the near term to generate income.

Long-Term Investments

Financial assets intended to be held for more than a year, including stocks, bonds, and real estate, for generating revenue or appreciating in value over time.