If annual demand is 50,000 units, the ordering cost is $25 per order, and the holding cost is $5 per unit per year, which of the following is the optimal order quantity using the fixed-order quantity model? A) 500 B) 708 C) 909 D) 634 E) 141

B) 708

Explanation:

The computation of the economic order quantity is shown below:

Data given in the question

Annual demand = 50,000 units

Ordering cost per order = $25

Holding cost per unit = $5

= 708 units

We apply the above formula to compute the economic order quantity so that the approximate value could come by considering the all items given in the question

the correct option is c

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