Which of the Following Is Not an Assumption of the Basic

question 1

Multiple Choice

Which of the following is not an assumption of the basic fixed-order quantity inventory model?

• A) Ordering or setup costs are constant.
• B) Inventory holding cost is based on average inventory.
• C) Returns to scale of holding inventory are diminishing.
• D) Lead time is constant.
• E) Demand for the product is uniform throughout the period.

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Definitions:

Discriminant Validity

The extent to which a measure does not correlate with other variables from which it is theoretically supposed to differ.

Interval Scale

A scale of measurement in which the intervals between numbers on the scale are all equal in size.

Ratio Scales

A type of measurement scale that has a true zero point and equal intervals, allowing for the comparison of absolute magnitudes of the numbers.

Absolute Zero

The theoretical temperature at which a system reaches its lowest possible energy state, equivalent to -273.15°C or 0 Kelvin.