The basic Economic Order Quantity (EOQ) model makes several assumptions to simplify inventory management decision-making. Among the options provided:

a. Quantity discounts are considered - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that the cost per unit is constant, regardless of the order size.

b. Lead time is known and constant - This is an assumption of the basic EOQ model. It assumes that the time between placing an order and receiving it is known and consistent.

c. Demand may be seasonal - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that demand is constant and known.

d. Orders can arrive in partial shipments - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that orders are received in full, not in partial shipments.

So, the correct answer is b. Lead time is known and constant.

Question

The basic Economic Order Quantity (EOQ) model makes several assumptions to simplify inventory management decision-making. Among the options provided:

a. Quantity discounts are considered - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that the cost per unit is constant, regardless of the order size.

b. Lead time is known and constant - This is an assumption of the basic EOQ model. It assumes that the time between placing an order and receiving it is known and consistent.

c. Demand may be seasonal - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that demand is constant and known.

d. Orders can arrive in partial shipments - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that orders are received in full, not in partial shipments.

So, the correct answer is b. Lead time is known and constant.

Knowee AI · Accepted Answer

The basic Economic Order Quantity (EOQ) model makes several assumptions to simplify inventory management decision-making. Among the options provided:

a. Quantity discounts are considered - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that the cost per unit is constant, regardless of the order size.

b. Lead time is known and constant - This is an assumption of the basic EOQ model. It assumes that the time between placing an order and receiving it is known and consistent.

c. Demand may be seasonal - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that demand is constant and known.

d. Orders can arrive in partial shipments - This is not an assumption of the basic EOQ model. The basic EOQ model assumes that orders are received in full, not in partial shipments.

So, the correct answer is b. Lead time is known and constant.

Which of the following is an assumption of the basic EOQ model?a.Quantity discounts are considered.b.Lead time is known and constant.c.Demand may be seasonal.d.Orders can arrive in partial shipments.

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