Question: You just computed the EOQ for an inventory item using the (Q,R) system, and your answer is Q = 315 units. The item in question

You just computed the EOQ for an inventory item using the (Q,R) system, and your answer is Q = 315 units. The item in question comes in boxes of 100, so you will need to round your answer. Which of the following presents the more valid logic: (a) Round the answer down to Q = 300, since that is the closest to the optimal value Q = 315 which minimizes average ordering + carrying costs. (b) Round the answer up to Q = 400, because Q = 300 will on average leave you with shortage of 15 units (compared to EOQ = 315) in each ordering cycle. EXPLAIN YOUR ANSWER! This means explain why the one you chose is correct, and why the one you did not choose is incorrect. (Note: one of the two statements above is based on incorrect logic, so you should ignore the logic presented if it is incorrect.)

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