Assuming the cost per order is constant, increasing the order quantity will cause annual ordering costs to:
A) decrease
B) increase
C) remain the same
D) increase at a decreasing rate
E) cannot be determined

Question

Quizplus · Accepted Answer

Annual ordering costs decrease as order quantity increases because fewer orders are needed to meet demand, reducing the total number of orders placed per year.

Assuming the Cost Per Order Is Constant, Increasing the Order