The economic order quantity is most widely used for determining how much to order in
A)a periodic inventory system.
B)a continuous inventory system.
C)an on-demand inventory system.
D)none of the above.

Question

Quizplus · Accepted Answer

The economic order quantity (EOQ) formula is primarily used in a continuous inventory system where inventory levels are constantly monitored and orders are placed as needed to maintain a certain level of stock. In such a system, the EOQ helps to determine the optimal order quantity that minimizes the total cost of ordering and holding inventory. The formula is not well-suited for periodic inventory systems, where inventory levels are only checked at fixed intervals (e.g. weekly, monthly), or for on-demand inventory systems, where items are produced or ordered only in response to customer demand.

The Economic Order Quantity Is Most Widely Used for Determining