A pharmacist wants to establish an optimal inventory policy for a new antibiotic that requires refrigeration in storage The

Question

A pharmacist wants to establish an optimal inventory policy for a new antibiotic that requires refrigeration in storage The pharmacist expects to sell 4800 packages of this antibioti at a steady rate during the next year She plans to place several orders of the same size spaced equally throughout the year The ordering cost for each delivery is 12 and carrying costs based on the average number of packages in inventory amount to 8 per year for one package Use this information to answer the following questions a Let x be the order quantity and r the number of orders placed during the year Find the inventory cost ordering cost plus carrying cost in terms of x and r C 12r 4x b Find the constraint function rx 4800 Type an equation c Determine the economic order quantity that minimizes the inventory cost and then find the minimum inventory cost 4 X

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