EOQ stands for which term?

• A. Economic Order Quantity
• B. Electronic Order Quotation
• C. Emergency Order Quantity
• D. Economic Output Quotient

Answer: (A)

Economic Order Quantity is the optimal batch size used to place an order so that annual ordering costs and holding costs are minimized. It’s the quantity you choose to order each time to reduce total inventory costs, balancing how often you place orders against how much inventory you hold. The idea is captured by the common formula Q* = sqrt((2DS)/H), where D is yearly demand, S is the cost to place an order, and H is the holding cost per unit per year. The other options don’t reflect this standard inventory concept: they describe unrelated phrases or roles and aren’t used to denote the optimized order size in inventory management.