APICS Certified Supply Chain Professional (CSCP) — Question 93

When determining lot sizes, consideration should be given to balancing which of the following costs?

Answer options

• A. Quality costs and product costs
• B. Cost of goods sold (COGS) and indirect labor costs
• C. Unit sales price and unit cost
• D. Ordering costs and carrying costs

Correct answer: D

Explanation

The correct answer is D because ordering costs and carrying costs are directly related to inventory management and lot sizing. Balancing these costs helps minimize total inventory costs. The other options do not specifically address the trade-offs involved in determining optimal lot sizes.