Question 2 (10 points) You just computed the EoQ for an inventory item using the

Q: Question 2 (10 points) You just computed the EoQ for an inventory item using the

The more valid logic is: (a) Round th answer down to Q = 200, since that is the closest to the optimal value q = 225 which minimizes average ordering + carrying costs

ID: 325996 • Letter: Q

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Question 2 (10 points) You just computed the EoQ for an inventory item using the (Q,R) system, and your answer is Q 225 units. The item in question comes in boxes of 100, so you will need to round your answer. Which of the following presents the more valid logic: (a) Round the answer down to Q - 200, since that is the closest to the optimal value Q- 225 which minimizes average ordering + carrying costs. (b) Round the answer up to Q 300, because Q 200 will on average leave you with shortage of 25 units (compared to EOQ - 225) in each ordering cycle

Explanation / Answer

The more valid logic is:

(a) Round th answer down to Q = 200, since that is the closest to the optimal value q = 225 which minimizes average ordering + carrying costs

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Question 2 (10 points) You just computed the EoQ for an inventory item using the

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