The economic order quantity helps a firm determine the most efficient size order to place.

Question

Quizplus · Accepted Answer

The economic order quantity (EOQ) formula takes into account the costs of ordering and holding inventory and calculates the optimal quantity of inventory to order each time. By determining the most efficient order size, a firm can minimize its inventory costs while ensuring it has enough inventory to meet demand. Therefore, the statement is true.

The Economic Order Quantity Helps a Firm Determine the Most