Neco Model Questions Vol1 2022 Commerce Question 14

Practice objective / multiple choice question 14 from the 2022 Neco Model Questions Vol1 Commerce examination.

Neco Model Questions Vol1 2022 Commerce Objective / Multiple Choice Hard Difficulty
Question 14 NECO_MODEL_QUESTIONS_VOL1 • 2022 • COMMERCE • objective

A warehouse has two storage zones. Zone A (low‑cost) can hold up to 8,000 m³ and charges \(\text{₦}2\) per m³ per month plus a fixed security fee of \(\text{₦}12,000\) per month if any goods are stored there. Zone B (high‑cost) can hold up to 5,000 m³ and charges \(\text{₦}5\) per m³ per month with the same \(\text{₦}12,000\) monthly security fee when used. An external temporary storage can be rented at \(\text{₦}8\) per m³ per month with no fixed fee, but only up to 3,000 m³. A retailer must store 10,000 m³ of goods for six months. Determine how many cubic metres should be stored in each zone (including external) to minimise the total cost, and state that minimum total cost.

Answer Options

A. Zone A: 6000 m³, Zone B: 3000 m³, External: 1000 m³; Minimum total cost = ₦354,000
B. Zone A: 8000 m³, Zone B: 2000 m³, External: 0 m³; Minimum total cost = ₦300,000
Correct Answer C. Zone A: 8000 m³, Zone B: 0 m³, External: 2000 m³; Minimum total cost = ₦264,000
D. Zone A: 7000 m³, Zone B: 2000 m³, External: 1000 m³; Minimum total cost = ₦336,000
Correct Answer
C
Correct Option:
Zone A: 8000 m³, Zone B: 0 m³, External: 2000 m³; Minimum total cost = ₦264,000

About This Question

This is Neco Model Questions Vol1 2022 Commerce Question 14. It is one of the objective questions from the 2022 Neco Model Questions Vol1 Commerce examination.

Difficulty level: Hard .

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