A Product Has a Demand of 4000 Units Per Year

question 95

Multiple Choice

A product has a demand of 4000 units per year. Ordering cost is $20, and holding cost is $4 per unit per year. The EOQ model is appropriate. The cost-minimizing solution for this product will cost ________ per year in total annual inventory (holding and setup) costs.

• A) $400
• B) $800
• C) $1200
• D) Zero; this is a class C item.
• E) Cannot be determined because the unit price is not known.

Recognize the role of property rights in efficient market allocation.

Distinguish between private and public goods.

Identify the conditions under which markets can fail to allocate resources efficiently.

Understand the concept of externalities and their impact on market efficiency.

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Definitions:

Process-Oriented Measures

Metrics used to evaluate the effectiveness and efficiency of a process within an organization.

Balanced Scorecard

A strategic planning and management system used for aligning business activities with the vision and strategy of the organization, improving internal and external communications, and monitoring performance against strategic goals.

Concrete Actions

They refer to specific, definitive steps taken to achieve a goal or implement plans.

Balanced Scorecard

A strategic planning and management system used to align business activities with the vision and strategy of the organization, improving internal and external communications and monitoring organizational performance against strategic goals.