Which of the following statements is true of economic order quantity (EOQ)?
A) The EOQ mathematically determines the minimum total inventory cost.
B) The EOQ takes into account inventory reorder costs and inventory carrying costs.
C) The optimal order size is determined by the EOQ model.
D) All of the above

Question

Quizplus · Accepted Answer

All of the given statements are true of economic order quantity (EOQ). The EOQ model helps in determining the minimum total inventory cost by considering both the inventory carrying costs and inventory reorder costs. Moreover, the optimal order size is determined by the EOQ model, which helps in efficient inventory management.

Which of the Following Statements Is True of Economic Order