# Question

For the basic EOQ model, use the square root formula to determine how Q* would change for each of the following changes in the costs or the demand rate. (Unless otherwise noted, consider each change by itself.)

(a) The setup cost is reduced to 25 percent of its original value.

(b) The annual demand rate becomes four times as large as its original value.

(c) Both changes in parts (a) and (b).

(d) The unit holding cost is reduced to 25 percent of its original value.

(e) Both changes in parts (a) and (d).

(a) The setup cost is reduced to 25 percent of its original value.

(b) The annual demand rate becomes four times as large as its original value.

(c) Both changes in parts (a) and (b).

(d) The unit holding cost is reduced to 25 percent of its original value.

(e) Both changes in parts (a) and (d).

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