Question

Which of the following statements about quantity discounts is false? A) The cost-minimizing solution may or may not be where annual holding costs equal annual ordering costs. B) In inventory management, item cost becomes relevant to inventory decisions only when a quantity discount is available. C) If carrying costs are expressed as a percentage of value, EOQ is larger at each lower price in the discount schedule. D) The larger the annual demand, the less attractive a discount schedule will be. E) When quantity discounts are allowed, the cost-minimizing order quantity minimizes the sum of holding, ordering, and product costs

Answer 1

Answer. D The larger the annual demand, the less attractive a discount schedule will be.

Quantity discounts are given to buyers to have less per unit costs .. more the quantity higher the incentives.