Which One of the Following Statements Regarding the Economic Order

question 72

Multiple Choice

Which one of the following statements regarding the economic order quantity (EOQ) is TRUE?

• A)The EOQ model combines several different item orders to the same supplier.
• B)If an order quantity is larger than the EOQ,the annual holding cost for cycle inventory exceeds the annual ordering cost.
• C)The EOQ model assumes a variable demand pattern.
• D)When the interest rate drops,the inventory holding cost decreases and the EOQ decreases.

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Definitions:

Equilibrium Constant

A numerical value that expresses the ratio of concentrations of products to reactants at equilibrium for a reversible chemical reaction at a constant temperature.

Reactants

Substances initially present in a chemical reaction that are consumed during the reaction to make products.

Products

Substances that are formed as a result of a chemical reaction, found on the right side of a chemical equation.

Constant Temperature

A condition or process that occurs at an unchanging temperature, regardless of other varying factors.