As the number of facilities increases, total logistics costs tend to follow a curve that first declines, then rises. Why?
A) Transportation and inventory costs first decline steeply, then rise, while facility costs always rise.
B) Transportation costs always decline, but eventually the rise in facility and inventory costs outweigh the declining transportation costs.
C) Facility costs first decline steeply, then rise, while transportation and inventory costs always rise.
D) Transportation costs first decline steeply, then rise, while facility and inventory costs always rise.
E) Inventory costs first decline steeply, then rise, while transportation and facility costs always rise.
Answer: D