Economic Order Quantity

Economic order quantity (EOQ) is the ideal order quantity a company should purchase to minimize inventory costs such as holding costs, shortage costs, and order costs. This production-scheduling model was developed in 1913 by Ford W. Harris and has been refined over time. The formula assumes that demand, ordering, and holding costs all remain constant.The EOQ is a company's optimal order quantity that minimizes its total costs related to ordering, receiving, and holding inventory.The EOQ formula is best applied in situations where demand, ordering, and holding costs remain constant over time.

Still want to learn more about Economic Order Quantity

Checkout other online study materials on SolutionInn

Related solved question answer on Economic Order Quantity

Join SolutionInn Study Help for
Study Help
2 Million+ Textbook Solutions
Learn the step-by-step answers to your textbook problems, just enter our Solution Library containing more than 2 Million+ textbooks solutions and help guides from over 1300 courses.
Study Help
24/7 Online Tutors
Tune up your concepts by asking our tutors any time around the clock and get prompt responses.
Post a Question

Answers from our tutors for your tough homework questions