Scenario $9\mathrm{.}6$

Consider the following data for an independent$-$demand item maintained by Angie Bonpensiero, the proprietor of a local auto repair shop:

Weekly demand $=50$ units

Ordering cost $=$ $$8/$order

Holding cost $=$ $$4/$unit$/$year

Weeks in a year $=50$

Use the information in Scenario $9\mathrm{.}6.$ Due to new ordering procedures initiated by Bonpensiero, the ordering cost is drops to $$4$ per order. At the same time, the weekly demand increases to $64$ units per week due to an increase in business. What effect do these changes have on the EOQ quantity for this item?

Question $4$Select one:

A$.$

The EOQ quantity remains unchanged.

B$.$

The EOQ quantity increases by $20\%.$

C$.$

The EOQ quantity decreases by $20\%.$

D$.$

Sufficient information is not available to answering this question.