Which of the following is not an assumption of the economic order quantity model?
A)Demand is known,constant,and independent.
B)Lead time is known and constant.
C)Quantity discounts are not possible.
D)Production and use can occur simultaneously.
E)The only variable costs are setup cost and holding (or carrying)cost.

Question

Quizplus · Accepted Answer

The Economic Order Quantity (EOQ) model assumes that demand is known and constant, lead time is known and constant, quantity discounts are not considered, and the only variable costs are setup cost and holding cost. It does not assume that production and use can occur simultaneously; this assumption is not part of the EOQ model framework.

Which of the Following Is Not an Assumption of the Economic