What Is the Primary Purpose of the Basic Economic Order

question 27

Multiple Choice

What is the primary purpose of the basic economic order quantity model shown below? Q* =

• A)to calculate the reorder point,so that replenishments take place at the proper time
• B)to minimize the sum of carrying cost and holding cost
• C)to maximize the customer service level
• D)to minimize the sum of setup cost and holding cost
• E)to calculate the optimum safety stock

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