How would you respond to the criticism that EOQ models tend to provide misleading results because values of D, S, and H are, at best, educated guesses?Under what circumstances would the amount of safety stock held beLarge?Small?Zero?What is meant by the term service level? Generally speaking, how is service level related to the amount of safety stock held?What are some ways in which a company can reduce the need for inventories?How would you respond to the criticism that EOQ models tend to provide misleading resultsbecause values of D, S, and H are, at best, educated guesses?Solution:The costs that are associated with…
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