Inventory Control and Planning A company expects to sell D units of a certain product per year. Sales are assumed to be at a steady rate with no shortages allowed. Each time an order for the product is placed, an ordering cost of K dollars is incurred. Each item costs p dollars, and the holding cost is h dollars per item per year. The order quantity (the number of items in each order) is x > 0. (a) Write an expression for the inventory cost (the combined ordering cost, purchasing cost, and holding cost) in terms of the quantities above. C( X ) = (b) What equation holds when the inventory cost is minimized? This quantity is called the economic order quantity (EOQ). X : Need Help? Read It