Which one of the following statements about quantity discounts is BEST?
A)The minimum cost point on each price curve is always feasible.
B)A price break is the maximum quantity needed to get a discount.
C)If the EOQ for the lowest price is feasible,this is the best lot size.
D)Either price or quantity is sufficient for the search for the best lot size.

Question

Quizplus · Accepted Answer

The EOQ for the lowest price is the lot size that minimizes the total cost of ordering and holding inventory, and is feasible to implement. Therefore, if this quantity is feasible for the organization, it is the best lot size to order. Option A is incorrect, as the minimum cost point may not always be feasible due to practical limitations, such as minimum order quantities or capacity constraints. Option B is incorrect, as a price break refers to the point at which a discount is offered, not the maximum quantity needed to receive it. Option D is incorrect, as both price and quantity are crucial factors in determining the best lot size and cannot be considered in isolation.

Which One of the Following Statements About Quantity Discounts Is