What is your economic order quantity if your annual demand is 100 units, the order placement cost is $25, and the holding cost per unit per year is $50?
A) 10 units
B) 50 units
C) 100 units
D) 200 units
E) None of these

Question

Quizplus · Accepted Answer

The Economic Order Quantity (EOQ) formula is √((2DS)/H), where D is the demand (100 units), S is the order cost ($25), and H is the holding cost ($50). Plugging in the values, EOQ = √((2*100*25)/50) = √(100) = 10 units.

What Is Your Economic Order Quantity If Your Annual Demand