Aberwald Corporation expects to order 126,000 memory chips for inventory during the coming year, and it will use this inventory at a constant rate. Fixed ordering costs are $200 per order; the purchase price per chip is $25; and the firm's inventory carrying costs is equal to 20 percent of the purchase price. (Assume a 360-day year.)
-What is the economic ordering quantity for chips?
A) 12,088
B) 3,175
C) 6,243
D) 13,675
E) 8,124

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The Answer of Aberwald Corporation expects to order 126,000 memory chips for inventory during the coming year, and it will use this inventory at a constant rate. Fixed ordering costs are $200 per order; the purchase price per chip is $25; and the firm's inventory carrying costs is equal to 20 percent of the purchase price. (Assume a 360-day year.)
-What is the economic ordering quantity for chips?
A) 12,088
B) 3,175
C) 6,243
D) 13,675
E) 8,124

Aberwald Corporation Expects to Order 126,000 Memory Chips for Inventory