The trade-off that exists between carrying costs and ordering costs is that they respond in opposite ways to the number of orders or size of orders.

Question

Quizplus · Accepted Answer

Carrying costs increase as the quantity ordered increases, while ordering costs decrease as the quantity ordered increases. Therefore, there is a trade-off between the two costs, and they respond in opposite ways to the number or size of orders.

The Trade-Off That Exists Between Carrying Costs and Ordering Costs