Using the Simple Order Quantity Model in an Inventory Control

question 74

Multiple Choice

Using the simple order quantity model in an inventory control problem, Kathy calculated the order quantity to be 1,000 units. In a review, she found out that the demand is actually double that of the quantity she had used and the holding cost is only half that of the value she used. The new economic order quantity using the correct data will be

• A) 1,000.
• B) 2,000.
• C) 1,414.
• D) 707.1.
• E) cannot be found without other cost information.

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Definitions:

Egocentrism

A cognitive characteristic where an individual is unable to understand that others may have different perspectives and feelings from their own.

Centration

The tendency, especially in young children, to focus on one aspect of a situation while neglecting others, influencing their understanding of cause and effect.

Object Permanence

The understanding that objects continue to exist even when they cannot be seen, heard, or touched, a concept developed in infancy.

Egocentrism

The inability to differentiate between one's own perspective and someone else's perspective.