Annual Demand for a Product Is 40,000 Units

question 26

Multiple Choice

Annual demand for a product is 40,000 units.The product is used at a constant rate over the 365 days the company is open every year.The annual holding cost for the product is estimated to be $2.50 per unit and the cost of placing each order is $125.00.If the company orders according to the economic order quantity (EOQ) formula then its optimal order size for this product would be

• A)2,000 units.
• B)4,000 units.
• C)20,000 units.
• D)40,000 units.

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Definitions:

Interdependence

describes a relationship between entities where they rely on each other, indicating mutual dependence for success or survival.

Antagonistic Attitudes

Hostile or opposing outlooks or behaviors towards others or specific concepts.

Negative Attitudes

Patterns of thinking or feeling that reflect a critical or pessimistic view towards a particular object, person, or situation.

Disagreements

Occurrences when parties hold or express different views or opinions, leading to conflict or debate.