Which of the following inventory management techniques gives the optimal amount of inventory to be purchased?

Question

Quizplus · Accepted Answer

The economic order quantity (EOQ) model calculates the optimal quantity of inventory to be purchased at a given time by balancing the costs of holding inventory (storage, insurance, depreciation) with the costs of ordering new inventory (receiving, setup, shipping). This approach minimizes the total cost of inventory management and ensures that the business has sufficient inventory to meet demand while avoiding excess inventory that can lead to waste and increased holding costs. The other options listed do not directly address inventory management optimization.

Which of the Following Inventory Management Techniques Gives the Optimal