Each year you sell 950 units of a product at a price of $899 each.The variable cost per unit is $575 and the carrying cost per unit is $16.90.You have been buying 100 units at a time.Your fixed cost of ordering is $60.What is the economic order quantity?
A)82 units
B)95 units
C)105 units
D)113 units
E)124 units

Question

Quizplus · Accepted Answer

EOQ = [(2 × 950 × $60)/$16.90]^1/2 = 82 units

Each Year You Sell 950 Units of a Product at a Price