What is the economic order quantity if the annual demand is 10,000 units,set up cost of placing each order is $3 and the holding cost per unit per year is $2?
A)174
B)123
C)245
D)116

Question

Quizplus · Accepted Answer

The Economic Order Quantity (EOQ) formula is $\sqrt{\frac{2DS}{H}}$, where $D$ is the annual demand, $S$ is the setup cost per order, and $H$ is the holding cost per unit per year. Plugging in the given values: $\sqrt{\frac{2*10000*3}{2}} = \sqrt{30000} = 173.205...$, which rounds to 174.

What Is the Economic Order Quantity If the Annual Demand