Question: A company is deciding on an order quantity, Q, using the economic order quantity (EOQ) formula to compute Q*. Suppose they ask the question: If

A company is deciding on an order quantity, Q, using the economic order quantity (EOQ) formula to compute Q*. Suppose they ask the question: If demand increases by a factor of k, by how much will the optimal lot size (order size) increase by? Which answer is correct?

a. k

b. k/2

c. k^2

d. the square root of k, k

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