After completing this chapter, you should be able to:

1. Define the term inventory, list the major reasons for holding inventories, and list the main requirements for effective inventory management.
2. Discuss the nature and importance of service inventories.
3. Explain periodic and perpetual review systems.
4. Explain the objectives of inventory management.
5. Describe the A-B-C approach and explain how it is useful.
6. Describe the basic EOQ model and its assumptions and solve typical problems.
7. Describe the economic production quantity model and solve typical problems.
8. Describe the quantity discount model and solve typical problems.
9. Describe reorder point models and solve typical problems.
10. Describe situations in which the singleperiod model would be appropriate, and solve typical problems.