For a certain product,ordering costs are $30 per order,and the holding cost is $15 per case of this product per year.If the projected annual demand is 900 cases,what is the economic order quantity?
A)40 cases
B)50 cases
C)60 cases
D)70 cases

Question

Quizplus · Accepted Answer

The Economic Order Quantity (EOQ) formula is $\sqrt{\frac{2DS}{H}}$, where $D$ is the demand, $S$ is the ordering cost, and $H$ is the holding cost. Plugging in the values ($D=900$, $S=30$, $H=15$), we get $\sqrt{\frac{2*900*30}{15}} = \sqrt{3600} = 60$ cases.

For a Certain Product,ordering Costs Are $30 Per Order,and the Holding