The economic demand quantity can also be found out with the assist of a graph. In this technique ordering cost, carrying cost and total inventory costs as per various lot sizes are plotted on the graph. The point at that the line of inventory carrying cost and the ordering cost intersect each other is the economic order quantity. At that point the total inventory cost is also minimizing. The function of EOQ is demonstrated below in the figure1.

Figure: Function of E.O.Q

 As in figure 1, costs as caring, ordering and total cost are plotted on the vertical axis (y) and order size is demonstrated on the horizontal axis (x). By figure 1 one can simply see that there is an inverse relation between ordering cost and inventory carrying cost that is inventory carrying cost raises and ordering cost decreases as the order size rises. In the first illustration the total cost line reduces as the order size increases, but this starts rising when reduce in ordering cost is more than offset through the raise in carrying cost.