Which of the Following Statements Is INCORRECT Regarding the EOQ

question 20

Multiple Choice

Which of the following statements is INCORRECT regarding the EOQ model?

• A) EOQ assumes that the lead times are known and fixed.
• B) EOQ assumes that the demand rates are constant and are known in advance.
• C) EOQ calculations are based on a constant unit item cost and do not take discounts or rebates into consideration
• D) The ordering cost or the setup cost is dependent on the number of items ordered or manufactured.

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Definitions:

Long-run Unemployment

Unemployment that persists in an economy for an extended period, often due to fundamental shifts in the economy or structural changes in the labor market.

Labor Markets

Markets where labor is traded, involving the hire and utilization of workers, affected by factors like wages, demand, and supply.

Job Search

The process by which workers find appropriate jobs given their tastes and skills

Workers Equally Well Suited

The concept that workers have the same level of skills and abilities, making them interchangeable for tasks or jobs.