A company makes beaded necklaces and spends $75,000 per year to hold beads in inventory and $55,000 per year to order the beads from the supplier. The beads fit the requirements for the economic order quantity inventory model. What can you say about the way this company is managing the inventory of beads? (Slide 22) O The company should increase the number of beads it orders per year O The company should decrease the number of beads it orders per year The company should decrease its order size to decrease its holding cost O The company is ordering the economic order quantity The company should increase its order size to decrease its ordering cost

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
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Question 8
A company makes beaded necklaces and spends $75,000 per year to hold beads in inventory and
$55,000 per year to order the beads from the supplier. The beads fit the requirements for the
economic order quantity inventory model. What can you say about the way this company is
managing the inventory of beads? (Slide 22)
O The company should increase the number of beads it orders per year
O The company should decrease the number of beads it orders per year
The company should decrease its order size to decrease its holding cost
O The company is ordering the economic order quantity
O The company should increase its order size to decrease its ordering cost
Transcribed Image Text:Question 8 A company makes beaded necklaces and spends $75,000 per year to hold beads in inventory and $55,000 per year to order the beads from the supplier. The beads fit the requirements for the economic order quantity inventory model. What can you say about the way this company is managing the inventory of beads? (Slide 22) O The company should increase the number of beads it orders per year O The company should decrease the number of beads it orders per year The company should decrease its order size to decrease its holding cost O The company is ordering the economic order quantity O The company should increase its order size to decrease its ordering cost
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