For the basic EOQ model,which of the following relationships is not true?
A)The optimal number of orders per year equals annual demand divided by the EOQ.
B)The reorder point equals daily demand multiplied by the lead-time in days,excluding safety stock.
C)Average inventory level equals one-half the order size.
D)The average dollar level of inventory equals unit price multiplied by order quantity.
E)At EOQ,annual ordering cost equals annual carrying cost.

Question

Quizplus · Accepted Answer

The average dollar level of inventory equals the unit price multiplied by the average inventory level, not the order quantity.

For the Basic EOQ Model,which of the Following Relationships Is