If managers increase the size of the order they place, the ordering cos_____t and the carrying cost _________.
A)falls; falls
B)falls; rises
C)rises; falls
D)rises; rises

Question

Quizplus · Accepted Answer

When managers increase the size of the orders they place, the ordering cost falls because fewer orders need to be placed over time. However, the carrying cost rises because holding larger quantities of inventory incurs higher storage and maintenance costs.

If Managers Increase the Size of the Order They Place