Neco Model Questions Vol1 2021 Commerce Question 7
Practice objective / multiple choice question 7 from the 2021 Neco Model Questions Vol1 Commerce examination.
A warehouse faces an annual demand of \(12\,000\) units for a product. The ordering cost is ₦2 000 per order. The holding cost is \(20\%\) of the unit cost per year. The unit cost is ₦150, but if the order quantity is at least \(1\,000\) units the unit cost falls to ₦140. Determine the order quantity that minimises the total annual cost and state the minimum total cost (rounded to the nearest hundred naira).
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About This Question
This is Neco Model Questions Vol1 2021 Commerce Question 7. It is one of the objective questions from the 2021 Neco Model Questions Vol1 Commerce examination.
Difficulty level: Hard .
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