Management wishes to use a FOQ lot- sizing rule for an item based on the economic order quantity. If the annual demand is 1200 units, the holding cost is $10/unit/year, and the setup cost is $50/lot, which one of the following fixed order quantities is most appropriate?
A) 90 units
B) 110 units
C) 130 units
D) 150 units

Question

Quizplus · Accepted Answer

The Answer of Management wishes to use a FOQ lot- sizing rule for an item based on the economic order quantity. If the annual demand is 1200 units, the holding cost is $10/unit/year, and the setup cost is $50/lot, which one of the following fixed order quantities is most appropriate?
A) 90 units
B) 110 units
C) 130 units
D) 150 units

Management Wishes to Use a FOQ Lot- Sizing Rule for an Item