Which of the following statements is true with regard to the order quantity?
A)If the order quantity in each order is large,then fewer orders will be placed,which will result in lower annual ordering costs.
B)If the order quantity in each order is small,then more orders will be placed,which will result in lower annual ordering costs.
C)If the order quantity in each order is large,then fewer orders will be placed,which will result in higher annual ordering costs.
D)If the order quantity in each order is small,the fewer orders will be placed,which will result in lower annual ordering costs.

Question

Quizplus · Accepted Answer

The statement "If the order quantity in each order is large, then fewer orders will be placed, which will result in lower annual ordering costs" is true because larger order quantities result in lower ordering costs per unit due to economies of scale, and fewer orders mean lower ordering costs overall.

Which of the Following Statements Is True with Regard to the Order