The economic order quantity (EOQ) is the order quantity which minimizes
A) the total inventory costs.
B) the order quantity in units.
C) the order cost per order.
D) the carrying costs per unit per period.

Question

Quizplus · Accepted Answer

The economic order quantity (EOQ) is calculated to minimize the total inventory costs, which include both ordering costs and holding costs. By optimizing the order quantity, a business can balance the cost of placing an order (order cost per order) with the cost of maintaining inventory (carrying costs per unit per period) to minimize overall costs.

The Economic Order Quantity (EOQ) Is the Order Quantity Which