A conflict between the EOQ model's optimal order quantity and the order quantity the purchasing manager,evaluated on conventional accounting numbers,regarded as optimal is considered a(n):
A)problem for the performance evaluation system to resolve.
B)goal congruence.
C)problem for the chief financial officer to resolve.
D)opportunity cost.

Question

Quizplus · Accepted Answer

This is a problem for the performance evaluation system because it highlights a discrepancy between the optimal order quantity determined by the EOQ model and the order quantity deemed optimal by the purchasing manager based on conventional accounting numbers. This discrepancy needs to be addressed by evaluating and potentially adjusting the performance evaluation system to ensure that it aligns with the company's operational efficiency goals.

A Conflict Between the EOQ Model's Optimal Order Quantity and the Order