10. In general, an increase in the fixed cost of ordering a product for inventory ____ the number of optimal orders and ____ the size of the costminimizing inventory.

A. decreases; increases

B. increases; increases

C. increases; decreases

D. decreases; decreases

11. Lumber produced from redwood trees can be classified into heartwood (wood from the interior of the tree) and sapwood (wood from the outer growth of the tree). If you are a manager of a home construction company uses only heartwood, the demand for sapwood will have no effect on the cost you pay for heartwood.

A. False

B. True

12. Small, closely located stores offer lower ____ than larger, farther apart stores.

i. transportation costs for their customers

ii. prices for their products

A. Both i and ii are correct.

B. Only i is correct.

C. Neither i nor ii is correct.

D. Only ii is correct