Suppose That a Company Needs 800 Items During a Year

Multiple Choice

Suppose that a company needs 800 items during a year and that preparation for each production run costs $60. Suppose further that it costs $8 to produce each item and $0.45 to store an item for one year. Use the inventory cost model to find the number of items in each production run that will minimize the total costs of production and storage. ​

A) 449 items
B) 462 items
C) 491 items
D) 480 items
E) 469 items