The economic-order quantity (EOQ) suggests the
A) right size orders to take.
B) break-even point for storing inventory.
C) break-even point for sales orders.
D) right amount of inventory to store.

Question

Quizplus · Accepted Answer

The economic-order quantity (EOQ) is a formula used to calculate the optimal inventory order quantity for a business. It suggests the right amount of inventory to store by taking into account the cost of holding inventory and the cost of placing an order. Therefore, the best choice is D - the right amount of inventory to store. A is incorrect because the EOQ does not necessarily determine the size of the orders a business should take. B and C are also incorrect because the EOQ only deals with inventory-related costs and does not factor in sales-related costs or break-even points.

The Economic-Order Quantity (EOQ) Suggests the