The EOQ,also known as the economic order quantity,is the optimal order size in terms of cost because it minimizes the annual total inventory cost.The EOQ is the lot size where inventory holding costs equal annual ordering costs.

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This statement accurately describes the concept of EOQ, which aims to find the optimal order size that balances the costs of carrying inventory and placing orders. By minimizing the total inventory cost, a company can achieve the most efficient use of its resources and achieve better profitability. The EOQ formula takes into account factors such as demand, lead time, carrying cost, and ordering cost to determine the optimal order quantity.

The EOQ,also Known as the Economic Order Quantity,is the Optimal