Which of the following is not an assumption of the economic order quantity model shown below?
Q* = $\sqrt { \frac { 2 \cdot D \cdot S } { H } }$
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 all demand is met without delays, meaning production and use cannot occur simultaneously. This assumption ensures that the inventory level drops to zero before a new order is placed and received.

Which of the Following Is Not an Assumption of the Economic