Name: Slide 1
Uploaded: 2022-10-04
Duration: 2 min
Description: Economic Order Quantity:. 1. EOQ = √2AO/C. Where,.

Economic Order Quantity:. 1. EOQ = √2AO/C. Where,. 

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A = Annual requirement O = No. of Order C = carrying cost

Example:   Annual requirement = 400000 unit  Cost per unit = Rs. 10  Ordering cost = Rs. 20 per order   Carrying cost = 10% of unit cost Required: EOQ No. of order Total cost at EOQ

EOQ = √2AO/C                   = √(2*400000*20)/1 = 4000 units

(b) No. of Order = A/EOQ                           = 400000/4000 = 100 times

(c) Total cost at EOQ = √2AOC                         = √2*400000*20*1 = Rs. 4000

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