The total annual cost is the sum of annual material cost,annual order cost,and annual holding cost,and is given as TC = CD + (D/Q)S + (Q/2)hC.

Name: The total annual cost is the sum of annual material cost,annual order cost,and annual holding cost,and is given as TC = CD + (D/Q)S + (Q/2)hC.
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Question

Quizplus · Accepted Answer

This statement is true. The total annual cost (TC) is calculated by summing the annual material cost (CD), the annual order cost ((D/Q)S) and the annual holding cost ((Q/2)hC), according to the formula given.

The Total Annual Cost Is the Sum of Annual Material