The EOQ Formula Has Been Criticised in a Number of Areas

question 38

Multiple Choice

The EOQ formula has been criticised in a number of areas. Which of the following is not an area of common criticism?

• A) The assumptions included in the models.
• B) The real costs of stock in operations.
• C) Small errors in estimating will result in a significant deviation.
• D) The use of the models as prescriptive devices.

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Definitions:

Shared Assumptions

Deeply held beliefs within an organization's culture that are often taken for granted but influence behaviors and decision-making processes.

Enacted Values

These are the values that are actually exhibited or converted into employee behavior within an organization.

Hidden Elements

Aspects of an organization that are not visible or overt but influence its culture and operations.

Organizational Culture

The shared values, beliefs, norms, and practices that shape the social and psychological environment of a business organization.