Answered: The economic order quantity (EOQ) model… | bartleby

Microeconomic Theory

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter11: Profit Maximization

Section: Chapter Questions

Problem 11.14P

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The economic order quantity (EOO) model is a classic independent demand inventory system that provides
many useful ordering decisions. The basic order decision is to determine the optimal order size that
minimizes total annual inventory costs.
Discuss any FIVE (5) assumptions when determining the economic order quantity. Support your answer
with relevant examples.

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