Which of the Following Statements About the Basic EOQ Model

question 124

Multiple Choice

Which of the following statements about the basic EOQ model is true?

• A) If the ordering cost were to double, the EOQ would rise.
• B) If annual demand were to double, the EOQ would increase.
• C) If the carrying cost were to increase, the EOQ would fall.
• D) If annual demand were to double, the number of orders per year would increase.
• E) All of the above statements are true.

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Definitions:

Supply Chain Partnership

A strategic alignment between different parties in the supply chain, aiming to improve efficiency, reduce costs, and enhance product or service quality through collaboration.

Cooperation And Trust

The collaboration and reliability between individuals or organizations, fundamental for effective partnerships and teamwork.

Bullwhip Effect

The phenomenon in supply chains where orders exhibit greater variance as one moves upstream in the chain, leading to inefficiency and excess inventory.

Supply Chain

A network of organizations, people, activities, information, and resources involved in moving a product or service from supplier to consumer.