If Annual Demand Is 35,000 Units, the Ordering Cost Is

question 29

Multiple Choice

If annual demand is 35,000 units, the ordering cost is $50 per order, and the holding cost is $0.65 per unit per year, which of the following is the optimal order quantity using the fixed-order-quantity model?

• A) 5,060
• B) 2,320
• C) 2,133
• D) 2,004
• E) 1,866

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Definitions:

Agreement

One of the four elements necessary for a contract; consists of an offer made by one party, the offeror, and the acceptance of the offer by another party, the offeree.

Principal

A principal can refer to the main party in a transaction or agreement, often used to denote the primary source of obligation or responsibility.

Unauthorized Departure

Leaving a place or position without permission or without following the proper protocols.

Satellite Dish

A type of parabolic antenna designed to receive or transmit information by radio waves to or from a communication satellite.