A shoe business meets the qualifications for using the economic order quantity (EOQ)model.The business sells 20,000 pairs of shoes per year.Ordering costs for supplies are $12 per order.Holding costs are $0.96 per pair of shoes per year.What is the EOQ for this business?

Question

Quizplus · Accepted Answer

The EOQ formula is √((2DS)/H), where D is demand (20,000), S is ordering cost ($12), and H is holding cost ($0.96). Plugging in these values gives √((2*20000*12)/0.96) = 707.11, which rounds to 708.

A Shoe Business Meets the Qualifications for Using the Economic