The way cost of understocking, cost of overstocking, the critical fractile, the optimal order quantity changes and if these changes are intuitive. Inventory and supply chain models: The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

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Chapter 12.5, Problem 13P

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To explain: The way cost of understocking, cost of overstocking, the critical fractile, the optimal order quantity changes and if these changes are intuitive.

Inventory and supply chain models:

The functions of inventory and supply chain are one of the most important business decision areas for an organization. The first important aspect of these concepts is to have adequate inventory on hand. The second important aspect is to carry a little amount of inventory as possible.

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