Which of the following is an assumption of the basic EOQ model?
A) Lead time is unknown.
B) Demand is known and constant.
C) Orders can arrive in partial shipments.
D) Quantity discounts are considered.
E) Lost sales are allowed, but not back orders.

Question

Quizplus · Accepted Answer

The basic EOQ model assumes that demand is known and constant over the planning horizon. This assumption allows for the calculation of the optimal order quantity that minimizes total inventory costs. The other options listed are not assumptions of the basic EOQ model.

Which of the Following Is an Assumption of the Basic