In the basic EOQ model,if lead time increases from five to 10 days,the EOQ will:
A)double.
B)increase,but not double.
C)decrease by a factor of two.
D)remain the same.
E)increase by the same ratio as lead time.

Question

Quizplus · Accepted Answer

The EOQ formula only takes into account the costs and quantities involved in ordering and holding inventory. It assumes a constant demand rate and lead time. Therefore, a change in lead time alone should not affect the EOQ.

In the Basic EOQ Model,if Lead Time Increases from Five