The larger the order quantity,the lower the annual relevant ordering costs,but the higher the annual relevant carrying costs.

Name: The larger the order quantity,the lower the annual relevant ordering costs,but the higher the annual relevant carrying costs.
Brand: Quizplus
Rating: 4.8 (32 reviews)

Question

Quizplus · Accepted Answer

This statement is true. Ordering in larger quantities means less frequent orders which in turn reduces the ordering costs. However, larger quantities also mean more inventory on hand which increases the carrying costs.

The Larger the Order Quantity,the Lower the Annual Relevant Ordering