Please answer question 22

Which of the following would cause average inventory holdings to decrease, other things held constant? a. The purchase price of inventory items decreases by 50 percent. b. The carrying price of an item decreases (as a percent of purchase price) c. The sales forecast is revised downward by 10 percent. d. Interest rates fall. e. Fixed order costs double. Holiday Inc, receives a $2 million payment once a year. Of this amount $600,000 is needed for cash payments made during the next year. Each time Holiday deposits money in its account, a charge of $2.00 is assessed is cover clerical costs. If Holiday can hold marketable securities that yield 5 percent, and then correct these securities to cash at a cost of only the $2 deposit charge, what is the total cost for one year of holding the minimum cost cash balances according to the Financial model? a. $6.928 b. $1733 c. $3.684 d. $346 e. $748