Flanders Bar and Grill Orders Cleaning Supply Kits Using the EOQ

Multiple Choice

Flanders Bar and Grill orders cleaning supply kits using the EOQ model. The restaurant estimates that it uses 525 kits per year. The purchase price is governed by a quantity discount structure. If the restaurant orders 100 or more units, the price per kit is $11. Below 100 units, the price is $12 per kit. What is the optimal order quantity?

A) 76.4
B) 100
C) 68.7
D) Cannot be determined from the information given