8. Carter Company orders 250 units at a time, and places 15 orders per year. Tot

Question

8. Carter Company orders 250 units at a time, and places 15 orders per year. Total ordering cost is $1,110 or $74 per order and total carrying cost is $1,750 or $14 per unit for the year. Which of the following statements is true? a. the economic order quantity (EOQ) is less than 250
b. total inventory-related cost is lower than it would be at the economic order quantity (EOQ)
c. the economic order quantity (EOQ) is more than 250
d. None of these.
e. the economic order quantity (EOQ) is 250 8. Carter Company orders 250 units at a time, and places 15 orders per year. Total ordering cost is $1,110 or $74 per order and total carrying cost is $1,750 or $14 per unit for the year. Which of the following statements is true? a. the economic order quantity (EOQ) is less than 250
b. total inventory-related cost is lower than it would be at the economic order quantity (EOQ)
c. the economic order quantity (EOQ) is more than 250
d. None of these.
e. the economic order quantity (EOQ) is 250 a. the economic order quantity (EOQ) is less than 250
b. total inventory-related cost is lower than it would be at the economic order quantity (EOQ)
c. the economic order quantity (EOQ) is more than 250
d. None of these.
e. the economic order quantity (EOQ) is 250

Explanation / Answer

b. total inventory-related cost is lower than it would be at the economic order quantity (EOQ)

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