Which of the Following Statements About Quantity Discounts Is False

question 37

Multiple Choice

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) The smaller the ordering cost, the less attractive a discount schedule will be.

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Definitions:

Mean

The average of a set of numbers, calculated by dividing the sum of all the values by the number of values.

Median

The middle value in a sorted list of numbers, which divides the data set into two halves.

IQR

Interquartile range, a measure of statistical dispersion being the difference between the 75th and 25th percentiles, or quartiles, in a data set.

Range

The difference between the highest and lowest values in a data set, giving an indication of the data's dispersion or variability.