A tire manufacturer currently produces tires in small quantities as they are ordered.The company learns that it can reduce costs significantly by producing one type of tire at a time in large quantities and storing its unsold tires for later sale.Should the company switch to large quantity production?

Question

Quizplus · Accepted Answer

It's often cheaper to produce large quantities of one size,and store the unsold quantity,than to have shorter production runs.Thus,storing goods allows the producer to achieve economies of scale in production.

A Tire Manufacturer Currently Produces Tires in Small Quantities as They