If Your Company Had an Annual Purchase Cost of Items

question 30

Multiple Choice

If your company had an annual purchase cost of items equal to $2,000,000,an annual holding cost of $150,000 and an annual ordering cost of $750,000 this scenario would reveal that:

• A)Your fixed lot size was lower than the EOQ
• B)Your fixed lot size was equal to the EOQ
• C)Your fixed lot size was higher than the EOQ
• D)Nothing because there is insufficient information to discern where the EOQ would be.