- 1 Marks
Question
A company uses 40,000 units of an item per annum. It is recorded that the holding costs are N4 per annum and the ordering cost is N50 per order. The Economic order Quantity is:
A. 2,500
B. 1,500
C. 1,000
D. 800
E. 500
Answer
C. 1,000
Explanation: The EOQ formula is applied as follows:
- Tags: Cost Management, Decision Making, EOQ, Forecasting Techniques, Inventory Management, Operations
- Level: Level 1
- Topic: Forecasting Techniques
- Series: NOV 2020
- Uploader: Dotse