Final answer:
Adding different product details (PD), like changes in price, does affect the calculation of Economic Order Quantity (EOQ) as it impacts the cost factors involved in inventory management. An increase in unit cost leads to higher holding costs and potentially a lower EOQ, whereas a decrease in price might result in a higher EOQ.
Step-by-step explanation:
The question "Does adding PD change Basic EOQ?" touches on the concept of Economic Order Quantity (EOQ) which is a business and financial topic. EOQ is a formula used in inventory management to determine the optimal order quantity that minimizes the total costs associated with ordering and holding inventory. The inclusion of different product details (PD) like changes in price does affect the computation of EOQ since it directly impacts the holding and ordering costs.
For instance, if the price of a product changes, this can influence the EOQ calculation. Let's say the EOQ model uses the unit cost to calculate the ordering cost and holding cost. A change in the unit cost, such as going from a price of $3.00 to $3.20, would affect the EOQ. Specifically, if the holding cost is a percentage of the unit cost, then as the unit cost increases, the holding cost increases. This means the EOQ would potentially decrease, as it is more expensive to hold inventory. Conversely, if prices decrease, holding costs would decrease, and the EOQ might increase.
It's important to note that these shifts in EOQ due to price changes could also influence the inventory management strategy. An accurate EOQ calculation ensures efficient inventory control, which is vital to maintaining balance between ordering costs and stocking costs, to avoid excessive inventory or stockouts.