Question: 1. In an economic order quantity problem, the total annual cost curve is at its maximum where the holding costs equal the setup costs. True

1. In an economic order quantity problem, the total annual cost curve is at its maximum where the holding costs equal the setup costs.

True

False

2. A product whose EOQ is 40 experiences a decrease in holding cost from $16 per unit annually to $1. The revised EOQ is

A. four times as large

B. one-fourth as large

C. sixteen times as large

D. one-sixteen as large

E. cannot be determined

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