In the EOQ Model,if Quantity Discounts Are Offered,buying a Larger

question 87

Multiple Choice

In the EOQ model,if quantity discounts are offered,buying a larger quantity just because of the lower per-unit purchase price ______.

• A)might not result in the minimum total annual cost because the holding costs are likely to increase
• B)will result in the minimum total annual cost
• C)might not result in the minimum total annual cost because the ordering costs are likely to increase
• D)will result in the highest total annual cost

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Definitions:

Contract Modification

Any change or alteration to the terms of a contract agreed upon by all parties involved.

Consideration

A legal concept referring to something of value given by both parties to a contract that induces them to enter into the agreement to exchange mutual performances.

Mirror-Image Rule

The principle that holds that the terms of the acceptance must mirror the terms of the offer; if the terms of the acceptance do not mirror the terms of the offer, no contract is formed, and the attempted acceptance is a counteroffer.

Mixed Sale

A contract that combines a good with a service or real estate.