Scenario 9.4
The Mwongola Company is a small manufacturing company that uses gear assemblies to produce four different models of mountain bikes. One of these gear assemblies, the "Smooth Shifter", is used for the two most expensive of Burdell's four models, and has an estimated annual demand of 300 units. Burdell estimates the cost to place an order is $40, and the holding cost for each assembly is $60 per year. The company operates 250 days per year.
-Use the information in Scenario 9.4. What is the economic order quantity for the Smooth Shifter?
A) less than or equal to 40 units
B) greater than 40 units but less than or equal to 80 units
C) greater than 80 units but less than or equal to 120 units
D) greater than 120 units

Question

Quizplus · Accepted Answer

The Answer of Scenario 9.4
The Mwongola Company is a small manufacturing company that uses gear assemblies to produce four different models of mountain bikes. One of these gear assemblies, the "Smooth Shifter", is used for the two most expensive of Burdell's four models, and has an estimated annual demand of 300 units. Burdell estimates the cost to place an order is $40, and the holding cost for each assembly is $60 per year. The company operates 250 days per year.
-Use the information in Scenario 9.4. What is the economic order quantity for the Smooth Shifter?
A) less than or equal to 40 units
B) greater than 40 units but less than or equal to 80 units
C) greater than 80 units but less than or equal to 120 units
D) greater than 120 units

Scenario 9.4 The Mwongola Company Is a Small Manufacturing Company That Uses