摘要：The overall objective of this paper is to investigate the fundamental cost elements of thetraditional EOQ model and develop the model by expiring some of its unrealistic assumptions.Over the last few decades, there have been numerous studies developing the EOQ model, butthe basic cost elements of the EOQ model have not been investigated efficiently. On the otherhand, the capital cost of buying inventories seems to be important to be investigated separatelyas well as holding cost and ordering cost in the model. In this paper, the capital cost of theinventory and possible stepwise increases in holding and setup cost are taken into account tomake a revised formula to compute the economic order quantity. The proposed model involvesexplicitly the capital cost of buying the inventories in the EOQ model to ensure the decisionmakers that their financial concerns are considered in the revised model and the new orderquantity results the minimum total cost.
