A Moving to another question will save this response Question 40 Which of the fo

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A Moving to another question will save this response Question 40 Which of the following statements about quantity discounts is FAL SE? The cost-minimizing solution may or may not be where annual holding costs equal annual o costs are expressed as a percentage of value, EOQ is larger at each lower price in the discount schedule. The larger the annual demand, the less attractive a discount schedule will be O In inventory management, item cost becomes relevant to order quantity decisions when a quantity discount is available. The smaller the ordering cost, the less attractive a discount schedule will be. Moving to another question will save this response.

Explanation / Answer

Answer: Option (C) - The larger annual demand, the less attractive a discount schedule will be.

Explanation: Quantity discounts are known as the discounts that are made available by a vendor or supplier to its customers on ordering large quantities of goods. When the annual demand of a firm is high and when the quantity discounts are available, the firm would want to order higher quantities each time it places an order so that it can avail the benefits of quantity discounts. Therefore, the larger the annual demand, the more attractive a discount schedule will be.

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