What is the purpose of sensitivity analysis, Operation Management

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What is the purpose of sensitivity analysis

Assignment:

1. Discuss the major inventory costs that are used in determining the EOQ.

2. What is the ROP? How is it determined?

3. What is the purpose of sensitivity analysis?

4. What assumptions are made in the EPQ model?

5. What happens to the EPQ model when the daily production rate becomes very large?

6. In the quantity discount model, why is the carrying cost expressed as a percentage of the unit cost, I, instead of the cost per unit per year, Ch?

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Operation Management: What is the purpose of sensitivity analysis

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