The EOQ model is designed to determine how much:
A) total inventory a firm needs during any one year.
B) total inventory costs will be for any one given year.
C) inventory should be purchased at one time.
D) inventory will be sold per day.
E) a firm loses in sales per day when an inventory item is depleted.

Question

Quizplus · Accepted Answer

The EOQ model (Economic Order Quantity) is designed to determine the optimal quantity of inventory that should be purchased at one time, in order to minimize total inventory costs (including ordering costs and holding costs) while ensuring that there is enough inventory to meet demand during lead time. Therefore, the correct choice is C - inventory should be purchased at one time.

The EOQ Model Is Designed to Determine How Much