Why Do Conflicts Arise Between the EOQ Model's Optimal Order

question 54

Essay

Why do conflicts arise between the EOQ model's optimal order quantity and the order quantity that managers regard as optimal?

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Definitions:

Distributors

Businesses or entities that purchase products from manufacturers and then sell them to retailers or directly to the end-users.

Independent

Refers to entities or individuals that are self-reliant and not influenced or controlled by others in terms of business operations or decisions.

Marketing Channel

A pathway through which goods and services flow from producers to consumers, involving intermediaries such as wholesalers and retailers.

Profits

The financial gain achieved when the revenues from business activities exceed the expenses, costs, and taxes needed to sustain the operation.