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Which sentence in the passage uses the correct calculation of economic order quantity, or EOQ, for this example?

A firm manufacturing airtight containers has an annual demand of 3,000 units. The cost per order is $200. The firm incurs a carrying cost of $10 per unit. The inventory management department has a weekly meeting. During the discussion, (A) Joe puts forth that they should use an EOQ of 346 units. (B) According to Austin, the EOQ should be 400 units. Gracie states that the EOQ should be 250 units.

A.
B.

Sagot :

Answer: 346 units(a)

Explanation: you multiply2* 3,000 *200 then divide by 10 and then square root it

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