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Which of these is NOT an assumption that is made with regard to the basic EOQ inventory model? A. Annual demand requirements are known B. Variation in both demand and lead time exists, and is known C. No quantity discounts are involved D. Each order is received as a single delivery

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Answer:

The correct answer is letter "B": Variation in both demand and lead time exists, and is known.

Explanation:

The Economic Order Quantity (EOQ) is a method to keep track of inventory based on several assumptions. According to the EOQ demand is known, constant and independent; lead time is known and constant; inventory receipts are immediate and complete; discounts on amounts are not feasible; and, stock-outs can be avoided absolutely.

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