Which of the Following Is Not One of the Assumptions

question 11

Multiple Choice

Which of the following is not one of the assumptions of the basic EOQ model?

• A)Annual demand requirements are known and constant.
• B)Lead time does not vary.
• C)Each order is received in a single delivery.
• D)Quantity discounts are available.
• E)Ordering and holding costs have been estimated reasonably accurately.

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Definitions:

Future Rate

An expected rate for a financial instrument or an economic variable at a specified future date.

Fixed Exchange Rate

A government policy to maintain the value of its currency at a set rate against another currency or a basket of currencies.

Covariance

A measure used in statistics to determine how much two random variables change together, indicating the direction of their linear relationship.

DAX Stock Market

The Deutscher Aktienindex (DAX), a major stock market index consisting of the 30 major German companies trading on the Frankfurt Stock Exchange.