Question

EOQ Calculation will be impacted by volume economies of scale such as?

1) Increase in ordering costs
2) Decrease in carrying costs
3) Increase in holding costs
4) Decrease in setup costs

Answer 1

Economies of scale, such as a decrease in carrying costs, can impact EOQ calculation by reducing costs.

Step-by-step explanation:

Economies of scale can impact EOQ calculation by reducing costs. One factor that can contribute to economies of scale is a decrease in carrying costs. When a business is able to produce goods in large quantities, the cost of storing and carrying inventory may decrease due to efficiencies in logistics and warehousing. This can result in lower overall costs and impact the EOQ calculation.