Suppose that a company needs 1,200,000 items during a year and that preparation for each production run costs $500. Suppose also that it costs $18 to produce each item and $3 per year to store an item. Use the inventory cost model to find the number of items in each production run so that the total costs of production and storage are minimized. items/run

Algebra & Trigonometry with Analytic Geometry
13th Edition
ISBN:9781133382119
Author:Swokowski
Publisher:Swokowski
Chapter9: Systems Of Equations And Inequalities
Section: Chapter Questions
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Suppose that a company needs 1,200,000 items during a year and that preparation for each production run costs $500. Suppose also that it costs $18 to produce each item and $3 per year to store an item.
Use the inventory cost model to find the number of items in each production run so that the total costs of production and storage are minimized.
items/run
Transcribed Image Text:Suppose that a company needs 1,200,000 items during a year and that preparation for each production run costs $500. Suppose also that it costs $18 to produce each item and $3 per year to store an item. Use the inventory cost model to find the number of items in each production run so that the total costs of production and storage are minimized. items/run
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