1.

What Makes Eoq Work For Inventory Control?

Answer»

The EOQ works if its four assumptions match the case it is used on. The assumptions are:

  1. Annual demand, carrying costs and ordering costs can be estimated.
  2. Inventory level is divided by 2, no safety STOCK, goods used uniformly and are gone by NEXT order.
  3. Stock-out, customer responsiveness and other costs not considered.
  4. No quantity DISCOUNTS.

The EOQ works if its four assumptions match the case it is used on. The assumptions are:


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