A retailer has determined the cost C of ordering and storing x units of a certain product is C=2x+ (300000/x) for 1<x<300. The delivery truck can bring at most 300 units per order. Find the order size that will minimize cost. Could the cost be decresed if the truck were replaced with one that could bring at most 400? Justify your answer. Show work.

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Patrina SchowalterLv2

25 Apr 2019

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The cost of inventory C depends on the ordering and storage costs according to the inventory model

Determine the order size that will minimize the cost, assuming that sales occur at a constant rate, Q is the number of units sold per year, r is the cost of storing one unit for one year, s is the cost of placing an order, and x is the number of units per order.

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