The Only Product of a Company Has an Annual Demand

question 16

Essay

The only product of a company has an annual demand of 4,000 units. The cost of placing an order is $20 and the cost of carrying one unit in inventory for one year is $4.
Required:
Determine the economic order quantity.

---

Definitions:

Comparative Advantage

The ability of an individual, company, or country to produce a good or service at a lower opportunity cost than competitors, leading to specialized production and trade benefits.

Geegaws

Inexpensive, showy trinkets or novelty items.

Doodads

Informal term for small, often decorative objects with no specific utility or function.

Type Alpha Employees

A categorization for employees who are highly motivated, confident, and capable of independent work.