_____ includes the costs of downtime and lost efficiency that occur when a machine is changed or adjusted to produce a different kind of inventory.
A) Ordering cost
B) Setup cost
C) Holding cost
D) Stockout cost

Question

Quizplus · Accepted Answer

Setup costs refer to the expenses incurred to change or adjust a machine or equipment to produce a different kind of inventory. This includes costs associated with downtime and lost efficiency, as well as labor costs for the setup process. Therefore, option B, setup cost, is the correct answer.

_____ Includes the Costs of Downtime and Lost Efficiency That