Which of the following inventory management approaches attempts to find the optimal inventory level that minimizes the total of shortage and carrying costs?
A) The ABC Approach
B) Just-in-time (JIT) inventory system
C) Material Requirement Planning (MRP)
D) Economic Order Quantity (EOQ) Model

Question

Quizplus · Accepted Answer

The Economic Order Quantity (EOQ) Model is designed to help find the ideal order quantity that minimizes the total costs associated with ordering, receiving, and holding inventory. This includes both the costs of carrying inventory and the costs related to shortages or not having enough inventory on hand.

Which of the Following Inventory Management Approaches Attempts to Find