What is the concept behind the EOQ model?
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter23: Other Topics In Working Capital Management
Section: Chapter Questions
Problem 2MC
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What is the concept behind the EOQ model?
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Step 1
Economic Order Quantity (EOQ) Model: It is a method of inventory costing that aims to identify the ideal order quantity for a company by minimizing shortage costs, order costs and holding costs. It helps the business to know the most optimum number of units to be ordered.
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