Which of these is not an assumption of the basic continuous review model?
a. the order quantity is constant, regardless of the demand. b. the price of each item is constant, regardless of how many are ordered at a time. c. the lead time to receive a new shipment is constant. d. demand for the item is constant.

Biochemical corp. requires $600,000 in financing over the next three years. the firm can borrow the funds for three years at 10.80 percent interest per year. the ceo decides to do a forecast and predicts that if she utilizes short-term financing instead, she will pay 7.50 percent interest in the first year, 12.15 percent interest in the second year, and 8.25 percent interest in the third year. assume interest is paid in full at the end of each year. a)determine the total interest cost under each plan. a) long term fixed rate: b) short term fixed rate: b) which plan is less costly? a) long term fixed rate plan b) short term variable rate plan