Economic Order Quantity (EOQ) is an important inventory management model used in Operations Management to determine the optimum quantity of inventory that an organization should order at one time. The main objective of the EOQ model is to minimize the total inventory cost while ensuring that sufficient materials are available for production and operations. It helps managers balance ordering costs and carrying or holding costs. The EOQ model is based on the principle that inventory costs are influenced mainly by two opposing factors. If an organization places orders frequently in small quantities, ordering costs increase because more purchase orders, transportation arrangements and administrative activities are required. On the other hand, if the organization orders in large quantities, inventory holding costs increase because more storage space, insurance, handling and capital investment are required. EOQ identifies the order quantity at which these two costs are balanced. The basic EOQ formula is: EOQ = √(2DS/H) where D represents annual demand for the item, S represents ordering cost per order, and H represents annual holding cost per unit. The formula indicates that EOQ increases when demand or ordering cost increases and decreases when holding cost increases. The EOQ model generally assumes that demand is known and remains constant throughout the planning period. It also assumes