12. As demand changes, EOQ too would change as a function of the square root of the change in demand (assume that ordering and holding costs remain constant). XYZ company sees that its demand for a particular SKU has declined from 8000 to 5000 per year while it's EOQ has declined by 10% in the same period of time. Is the inventory manager doing a good job managing that SKU, assuming that all other factors have remained constant.

EOQ = sq root of [(2D*S)/H]

Where:

D = annual demand in units

S = cost of placing 1 order; H = cost of holding 1 unit of that item in inventory for 1 year

		No
		Yes
		Cannot say