In the EOQ model,if our order quantity is less than the economic order quantity,then ______.
A)the annual ordering costs will be the same or lower than the annual holding costs
B)the annual ordering costs will be the same as the annual holding costs
C)the annual ordering costs will be higher than the annual holding costs
D)the annual ordering costs will be lower than the annual holding costs

Question

Quizplus · Accepted Answer

If the order quantity is less than the economic order quantity (EOQ), it means more orders will be placed throughout the year to meet demand. This increases the annual ordering costs, making them higher than the annual holding costs.

In the EOQ Model,if Our Order Quantity Is Less Than