ENTREPRENEURIAL OPERATIONS
INVENTORY MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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In the basic EOQ model, annual ordering cost and annual ordering cost are equal for the optional order quantity
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True
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False
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Either A or B
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None of the above
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Explanation:
Detailed explanation-1: -Ordering cost and carrying cost will remain equal at the EOQ level.
Detailed explanation-2: -Economic Order Quantity (EOQ) is the level of inventory that minimizes the total cost of holding and ordering inventory over a period of time. Usually the time period is one year. The total cost of inventory is the sum of the purchase, ordering and holding costs.
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