Answer the Following Questions Using the Information Below:
the Allianz

question 35

Multiple Choice

Answer the following questions using the information below:
The Allianz Company produces a specialty wood furniture product, and has the following information available concerning its inventory items:
$\begin{array} { l } \text {Relevant ordering costs per purchase order }&\$450 \\ \text {Relevant carrying costs per year for each package: }& \\ \text { Required annual return on investment}& 15\%\\ \text {Required other costs per wear }& \$4\\\end{array}$
Annual demand is 30,000 packages per year. The purchase price per package is $48.
-What is the economic order quantity?

• A) 1,936.50 units
• B) 1,414.21 units
• C) 1,552.65 units
• D) 2,598.07 units

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Definitions:

Face Value

The nominal or dollar value printed on a security or financial instrument, such as a bond or stock certificate, representing its value at issuance.

Bonds' Market Value

The current price at which a bond is trading in the market, which can be above (at a premium) or below (at a discount) its face value.

Prices Quoted

The stated prices for goods or services offered to customers, which can be subject to negotiation or change.

Percentage

A proportion or share in relation to a whole, typically expressed as a fraction of 100.