Gce Model Questions Vol1 2018 Commerce Question 50
Practice objective / multiple choice question 50 from the 2018 Gce Model Questions Vol1 Commerce examination.
A retailer faces an annual demand of 12,000 units for a product. The supplier offers the following quantity discounts: \(500\) naira per unit for orders up to 2,000 units, \(480\) naira per unit for orders of 2,001-5,000 units, and \(460\) naira per unit for orders of 5,001 units or more. The retailer incurs a fixed ordering cost of \(2,000\) naira per order and a carrying cost equal to 25 % of the unit cost per year. Determine the order quantity that minimises the total annual cost and state the corresponding total cost (in naira). Assume the discount applies to all units in the order.
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About This Question
This is Gce Model Questions Vol1 2018 Commerce Question 50. It is one of the objective questions from the 2018 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Hard .
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