Figure 8-3 Martin Company Uses 625 Units of a Part

question 119

Multiple Choice

Figure 8-3 Martin Company uses 625 units of a part each year. The cost of placing one order is $8; the cost of carrying one unit in inventory for a year is $4.
-Refer to Figure 8-3. Martin has decided to begin ordering 40 units at a time. What is the average annual ordering cost of Martin's new policy?

• A) $190
• B) $150
• C) $125
• D) $100
• E) $145

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Definitions:

Afterbirth

The placenta and other materials expelled from the uterus following the birth of a baby.

Conceive

To become pregnant or to form a new idea or plan in the mind.

Exposure

The condition of being subject to something which may have an impact, such as disease or elements, or gaining experience in a certain field.

Lead

A chemical element with the symbol Pb that is used in various industries but is toxic to humans and animals when ingested or inhaled.