If the Actual Order Quantity Is the Economic Order Quantity

question 136

Multiple Choice

If the actual order quantity is the economic order quantity in a problem that meets the assumptions of the economic order quantity model shown below,the average amount of inventory on hand: Q* =

• A)is smaller than the holding cost per unit.
• B)is zero.
• C)is one-half of the economic order quantity.
• D)is affected by the amount of product cost.
• E)goes down if the holding cost per unit goes down.

---

Definitions:

Statement Of Cash Flows

A financial statement that provides aggregate data regarding all cash inflows a company receives from its ongoing operations, investment activities, and financing, as well as all cash outflows that pay for business activities and investments during a given period.

Common Stock

A type of security that signifies ownership in a corporation, representing a claim on part of the corporation's profits and assets.

Market Price

The current price at which an asset or service can be bought or sold in the open market.

Operating Activities

These are the primary day-to-day activities of a company involved in producing and delivering its products or services, which are reflected in the income statement.