1. ABC needs $9,600,000 of product from a supplier and asks them for a short-term loan. The supplier tells them that they can have a loan and they will only charge them $384,000 in interest if they pay in 100 days. The true cost to ABC is:

A. 4.00%

B. 15.39%

C. 16.07%

D. 15.16%

2. Messa Machine Tool expects sales of $3,400,000 with a sales price per unit of $10. The firm estimates an ordering cost of $200 per order, with an inventory carrying cost of $4.00 per unit. What is the optimum order size?

A. 18,439 units

B. 340,000 units

C. 83 units

D. 5,831 units