In the basic EOQ model, annual holding cost is one-half of the total annual cost for all items purchased.

Name: In the basic EOQ model, annual holding cost is one-half of the total annual cost for all items purchased.
Brand: Quizplus
Rating: 4.9 (40 reviews)

Question

Quizplus · Accepted Answer

In the basic EOQ model, the annual holding cost is not necessarily one-half of the total annual cost. The total annual cost includes both holding and ordering costs, and the EOQ is designed to minimize the sum of these costs.

In the Basic EOQ Model, Annual Holding Cost Is One-Half