If the Marginal Reduction in Order Costs Exceeds the Marginal

question 43

Multiple Choice

If the marginal reduction in order costs exceeds the marginal carrying cost of inventory,then:

• A) the firm has minimized its total carrying costs.
• B) the firm should increase its order size.
• C) the firm should decrease its order size.
• D) the firm has maximized its order costs.

---

Definitions:

Pseudoscience

Claims, beliefs, or practices presented as scientific but lacking empirical evidence or falsifiability, not adhering to the scientific method.

Testable Explanation

A hypothesis or theory that can be put to the test, designed to explain phenomena in the natural world.

Hypothesis

An initial hypothesis put forward to explain a phenomenon that serves as a basis for further study and can be verified by experimental and observational means.

Scientific Theory

A well-substantiated explanation of some aspect of the natural world, based on a body of evidence and repeatedly tested hypotheses.