Chestnut Tree Farms has identified the following two mutually exclusive projects: Year Cash Flow (A) Cash Flow (B) 0 −$ 40,000 −
$ 40,000 1 11,300 17,400 2 14,800 14,100 3 13,700 12,900 4 7,900 2,200 Over what range of discount rates would you choose Project A? Multiple Choice 7.13 percent or less 6.57 percent or more 6.38 percent or less 7.13 percent or more 6.38 percent or more
1 answer:
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Answer:
34
Explanation:
Annual demand D = 4,200 bags
Ordering cost S = $10.70
Holding cost H = $76
Economic order quantity =
Economic order quantity =
Economic order quantity =
Economic order quantity =
Economic order quantity = 34.389388
Economic order quantity = 34