For the basic EOQ model, what is the formula for the total annual cost?
B)(D/
Q)S + (Q/2)H
C)(Q/
D)S + (Q/2)H
D)DQ/S + 2Q/H

Question

For the basic EOQ model, what is the formula for the total annual cost?
B)(D/
Q)S + (Q/2)H 
C)(Q/
D)S + (Q/2)H 
D)DQ/S + 2Q/H

Quizplus · Accepted Answer

The formula for the total annual cost in the basic EOQ model is (D/Q)S + (Q/2)H, which represents the cost of ordering and the cost of holding inventory. Option A is incorrect because it is not a valid formula. Option C is also incorrect because it is not the correct order of the terms in the formula. Option D is incorrect because it is not a valid formula for the total annual cost. Option E is incorrect because it does not represent the correct formula for the total annual cost. Therefore, the best choice is B.

For the Basic EOQ Model, What Is the Formula for the Total