In the economic manufacturing quantity model (EMQ), the annual consumption rate must be less than the annual production rate.

Question

Quizplus · Accepted Answer

The EMQ model assumes that the annual consumption rate is less than or equal to the annual production rate, as it is not economically feasible for a company to produce more than it can sell or consume. This assumption allows for the efficient production of goods while minimizing costs.

In the Economic Manufacturing Quantity Model (EMQ), the Annual Consumption