The order volume corresponding to the lowest sum of order-processing and inventory-holding costs is known as the
A) economic order quantity.
B) reorder point.
C) total-cost quantity.
D) electronic data interchange level.

Question

Quizplus · Accepted Answer

The economic order quantity (EOQ) is the order volume that minimizes the total of order-processing and inventory-holding costs.

The Order Volume Corresponding to the Lowest Sum of Order-Processing