Problem: VIM manufactures wooden boxes. Demand is evenly spread over the year and the order lead time is constant. VIM is keen to avoid stockouts. The company would like to introduce Economic Order Quantity (EOQ), and would like to understand the consequences and suitability of using the EOQ model. Which two of the following statements regarding suitability or consequences of VIM using EOQ are correct? Solution A. There is a risk of stockouts when using the EOQ model. B. The pattern of customer demand allows use of the EOQ model. C. Wood must be delivered before the previous inventory is fully used. D. The current order lead time suggests that the EOQ model is unsuitable. E. A minimum level of buffer stock is not required.