# What is the basic assumption of the EOQ model Mcq?

## What is the basic assumption of the EOQ model Mcq?

An assumption of EOQ is: Demand is unknown. An item is produced continuously. An item is purchased in lots or batches.

## Which of the following statements concerning the basic EOQ model is true?

Which of the following statements concerning the basic EOQ model is true? If an actual order quantity is smaller than-the EOQ, the annual holding cost is less than the annual ordering cost. An increase in holding cost will increase the EOQ value.

## What cost are considered in the basic EOQ model?

Although we have identified a number of costs associated with inventory decisions in the chapter, only two categories, carrying cost and ordering cost, are considered in the basic EOQ model.

## Which assumption is not part of the basic EOQ model?

∴ So, stochastic demand is not an underlying assumption of the basic EOQ model.

## Which of the following is are the assumptions of economic order quantity EOQ )? Mcq?

Which of the following is/are the assumptions of Economic order quantity (EOQ)? There are no bulk purchase discounts for making orders in large sizes. All units purchased for each item of material cost the same unit price.

## Which of the following is not an assumption of the basic economic order quantity model?

∴ So, stochastic demand is not an underlying assumption of the basic EOQ model.

## Which of the following are assumptions used in the basic fixed order quantity inventory model?

The Fixed Order Quantity method assumes that all the variables are known with certainty and remains constant. Such variables could be the sales, unit cost, holding cost, Lead time, stock out cost, etc.

## What do you mean by EOQ write assumption of EOQ?

Underlying assumption of the EOQ model The cost of the ordering remains constant. The demand rate for the year is known and evenly spread throughout the year. The lead time is not fluctuating (lead time is the latency time it takes a process to initiate and complete).

## Which of the following is are the assumptions of economic order quantity EOQ?

Which of the following is/are the assumptions of Economic order quantity (EOQ)? There are no bulk purchase discounts for making orders in large sizes. All units purchased for each item of material cost the same unit price.

## Which of the following is a fixed order quantity system?

An inventory management system in which replenishment stock is ordered when the stock reaches a reorder point and the replenishment quantity is kept fixed irrespective of external circumstances. It is termed as FOQ – Fixed Order Quantity.

## Which of the following is not an assumption for basic EOQ inventory model?

∴ So, stochastic demand is not an underlying assumption of the basic EOQ model.

## What are the assumptions of the basic fixed order quantity inventory model?

The Fixed Order Quantity method assumes that all the variables are known with certainty and remains constant. Such variables could be the sales, unit cost, holding cost, Lead time, stock out cost, etc.

## What are the assumptions made in fixed order quantity model?

Underlying assumption of the EOQ model The cost of the ordering remains constant. The demand rate for the year is known and evenly spread throughout the year. The lead time is not fluctuating (lead time is the latency time it takes a process to initiate and complete).