The managerial R,Q model is called “managerial” because itshould be used by managers. TRUE/FALSE
The newsvendor model does not consider ordering costs since itis assumed that the cost of placing an order is zero.TRUE/FALSE
In a newsvendor context, the cost of overstocking per unit canbe computed as follows:
Purchase cost – sales price + disposal cost Order placement cost + inventory holding cost – stockoutcost Disposal cost – salvage value + purchase cost Salvage value + sales price – purchase cost What is the objective of a newsvendor model? Maximize customer sales Minimize inventory levels Minimize the sum of the costs of over- and understocking Minimize the sum of ordering and holding costs |
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