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EOQ inventory

Aaccastudent7y ago
When we are given buffer stock in the question, we add their holding cost to the total holding cost... Are we also required to add their purchase cost to total purchase cost ? Thanks
John MoffatJohn MoffatTutor7y ago#1
No - holding buffer stock does not mean that they are buying more over the year. It just means that they are ordering new deliveries sooner than in a perfect world they would need to.
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