33. Profile of Inventory Level Over Time Quantity on hand Q Receive order Place order Receive order Place order Receive order Lead time Reorder point Demand rate Time Constant Demand
34.
35. Time Inventory Order Size Note: • No Stockouts • Order when no inventory • Order Size determines policy
36. Order Quantity (Q) The Total-Cost Curve is U-Shaped Ordering Costs Q O Annual Cost ( optimal order quantity) or EOQ Holding Costs