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Inventory control: definition of Economic Order Quantity (EOQ) Select what EOQ represents within inventory control theory. Choose the correct meaning.

Q: Inventory control: definition of Economic Order Quantity (EOQ) Select what EOQ represents within inventory control theory. Choose the correct meaning.

Concept EOQ is the order quantity that minimizes the total of annual ordering and holding costs under classical assumptions (constant demand, instantaneous replenishment, no shortages). Final Answer Optimum lot size (order quantity)

Difficulty: Easy

Average inventory level
Optimum lot size (order quantity)
Warehouse capacity
Lot size at accounting break-even

Correct Answer: Optimum lot size (order quantity)

Explanation:

Concept
EOQ is the order quantity that minimizes the total of annual ordering and holding costs under classical assumptions (constant demand, instantaneous replenishment, no shortages).

Final Answer
Optimum lot size (order quantity)

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