The costs associated with an EOQ value are typically very se

The costs associated with an EOQ value are typically very sensitive to changes in quantity; small changes in quantities cause large changes in costs.

Question 16 options:

True False

Check all of the various cost components included in carrying or holding costs.

Question 15 options:

capital costs

interest rates

physical space

handling costs

pilferage and scrap

deterioration

obsolescence

Solution

Dear Student, only one question is allowed at a time.

Answer 1

True, the costs associated with an EOQ value are typically very sensitive to changes in quantity. Ordering costs decrease with increase in quantity ordered and carrying costs increase with increase in quantity ordered and vice versa.