Franconia Notch Blowers Would Like to Find the Optimum Size

question 85

Multiple Choice

Franconia Notch Blowers would like to find the optimum size order given that it annually sells 10,000 snow blowers per year.It costs Franconia $75 each time it processes an order for snow blowers and the carrying cost for each blower is $50 per year.What is the optimum order size for Franconia?

• A) 30,000
• B) 15,000
• C) 173.21
• D) 122.47

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Definitions:

Coefficient Of Elasticity

A measure used in economics to show how much the quantity demanded or supplied of a good responds to a change in its price or income level.

Special Sale

A promotional offer that temporarily reduces the price of items or services to encourage purchases.

Price Range

The spread between the highest and lowest selling price of a good or service in a market over a certain period of time.

Total Revenues

The total amount of money generated by a firm from its sales activities before any expenses are subtracted.