Which of the Following Is Not an Assumption of the Basic

question 18

Multiple Choice

Which of the following is not an assumption of the basic fixed-order quantity inventory model?

• A)Ordering or setup costs are constant
• B)Inventory holding cost is based on average inventory
• C)Diminishing returns to scale of holding inventory
• D)Lead time is constant
• E)Demand for the product is uniform throughout the period

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Definitions:

Relative Advantage

The degree to which an innovation is perceived as better than the idea it supersedes.

Diffusion

The process through which an innovation is communicated over time among the participants in a social system.

Innovation

The act of inventing, evolving, and applying novel concepts, goods, or techniques to enhance or substitute the current ones.

Observability

The degree to which the results of an innovation or change can be seen and understood by others.