Which One of the Following Statements Is True

question 23

Multiple Choice

Which one of the following statements is true?

• A)The EOQ is most accurate when both inventory and order costs are estimated on a full cost basis.
• B)The EOQ is most accurate when both inventory and order costs are estimated on a pure variable cost basis.
• C)The EOQ is most accurate when inventory costs are estimated on a full cost basis while order costs are estimated on a pure variable cost basis.
• D)The EOQ is most accurate when inventory costs are estimated on a pure variable cost basis while order costs are estimated on a full cost basis.

---

Definitions:

Internal Rate

Often refers to the internal rate of return (IRR), which is a discount rate that makes the net present value of all cash flows from a particular project equal to zero.

Return

The amount of profit or loss gained from an investment relative to its initial cost.

Project A

Not a definitive key term without additional context; it likely refers to a specific, named project within a given context. NO.

Net Present Value

The gap between how much cash comes in and goes out, measured in present value terms, during a certain period.