In the quantity discount model, with carrying cost stated as a percentage of unit purchase price, in order for the EOQ of the lowest curve to be optimum, it must:
A)have the lowest total cost
B)be in a feasible range
C)be to the left of the price break quantity for that price
D)have the largest quantity compared to other EOQ's
E)none of the above

Question

Quizplus · Accepted Answer

For the EOQ of the lowest curve to be optimum in a quantity discount model, it must be in a feasible range, meaning it should be within the range of quantities where the discount applies.

In the Quantity Discount Model, with Carrying Cost Stated as a Percentage