An office supply company is attempting to determine the order quantity for laser printer toner cartridges which are sold to local businesses. Annual demand is 20,000 units and each cartridge costs the store $25. It costs $30 to place an order and the inventory carrying cost rate is 25% of the value of the item. The following spreadsheet has been set up to solve the problem. What constraint would you impose on this problem to ensure that at least one order is placed per year?
A) MAX B9
B) B9 = 1
C) B9 ≥ 1
D) MIN B11

Question

An office supply company is attempting to determine the order quantity for laser printer toner cartridges which are sold to local businesses. Annual demand is 20,000 units and each cartridge costs the store $25. It costs $30 to place an order and the inventory carrying cost rate is 25% of the value of the item. The following spreadsheet has been set up to solve the problem. What constraint would you impose on this problem to ensure that at least one order is placed per year? 
A) MAX B9 
B) B9 = 1 
C) B9 ≥ 1 
D) MIN B11

Quizplus · Accepted Answer

To ensure that at least one order is placed per year, the company should set a minimum order quantity of 1. Therefore, the constraint that should be imposed on this problem is B9 ≥ 1. Option C is the correct answer as it represents this constraint. Options A and D are incorrect because they do not impose a minimum order quantity constraint, and option B is incorrect because it sets the order quantity equal to 1, which may not always be the most optimal choice.

An Office Supply Company Is Attempting to Determine the Order