All of the Following Are Possible Reasons for Using the Fixed

question 131

Multiple Choice

All of the following are possible reasons for using the fixed order interval model except:

• A)that supplier policy encourages use.
• B)that grouping orders of items held in inventory can save in shipping costs.
• C)that the level of safety stock required is lower than with an EOQ/ROP model.
• D)that it is suited to periodic checks of inventory levels rather than continuous monitoring.
• E)that continuous monitoring is not practical.

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Definitions:

Parameters

Quantitative values that define the behavior and characteristics of a model or function.

Classical Definition

The Classical Definition, often referred to in the context of probability, is an approach where the probability of an event is calculated by dividing the number of favorable outcomes by the total number of equally likely outcomes.

Probability

Probability measures the likelihood of a particular event occurring, expressed as a number between 0 and 1, where 1 represents certainty.

Probability Density Function

A function that describes the likelihood of a random variable to take on a specific value, used in the realm of statistics.