This paperconsidersavariantoftheeconomicorderquantity(EOQ)modelunderrandomsupply.A
binomialsupplymodelisadoptedwhereeveryitemreceivedisofimperfectqualitywiththesame
probability.Westudytherealisticcasewherethequalitiesofitemsinanorderarecorrelatedanddraw
useful insights,themostinterestingofwhichisthatcorrelationdecreasestheordersize.Several
practicalcorrelationpatternsareinvestigatedanddiscussed.Wealsoshowthatseveralcommonly
used modelsintheliteraturecanberepresentedbyanequivalentcorrelatedbinomialsupplymodel.