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Economic Production Quantity model (also known as the EPQ model) is an extension of the Economic Order Quantity model. The EPQ model was developed by E.W. Taft in 1918. The difference being that the EPQ model assumes orders are received incrementally during the production process.
The function of this model is to balance the inventory holding cost and the average fixed ordering cost.
In some literature Economic Manufacturing Quantity model (EMQ) is used for Economic Production Quantity model (EPQ). Similar to the EOQ model, EPQ is a single product lot scheduling method. A multi product extension to these models is called Product Cycling Problem.
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