Discuss two potential issues that may develop when using the traditional EOQ model with quantity discount.
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Discuss two potential issues that may develop when using the traditional EOQ model with quantity discount.
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- Explain two problems that may arise when using standard EOQ model when quantity discounts are allowed.How must the application of the basic EOQ model bealtered in order to reflect quantity discounts?Explain why it is not necessary to include product cost (price or price time quanity in the EOQ model, but the quantity discount model requires this information ?
- Perform a mathematical analysis of the Wilson EOQ model, and elaborate on its relevance and applicability in real-world scenarios.Explain why it is not necessary to include product cost(price or price times quantity) in the EOQ model, but thequantity discount model requires this information.Discuss why is it not necessary to include product cost in the EQQ model, but the quantity inventory system, discount model requires this information ?
- When quantity discounts are offered, why is it not necessary to check discount points that are below the EOQ orpoints above the EOQ that are not discount points?What are the basic EOQ model's assumptions, and to what extent do they limit the model's utility?Compare and contrast the fixed quantity version of EOQ with the fixed interval version. In which situations would each be used?