Problems:
Sample Solution: Linear optimization: Inventory Management
Sales per year 10,400 cd's
Mfg/Purchasing Costs
She buys from supplier >= 1000 at $4.45 ea CD
She buys from supplier <=1000 at $4.50 ea CD
Delivery Charge from her supplier is $10/shipment regardless of size
She pays Finance Rate annual interest rate 15%
She pays NYS Property Tax 5% on Annual Inv Value
She pays Insurance Charges 0.02 for every dollar of inventory
She Buys from her supplier 200 CD's/Week
How much does inv management cost her?
Best small order inventory plan?
how big are her orders?
how much does it cost her?
How much does she save?