Computing the cost of storage space

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Reference no: EM131801415

Qusetion: Wilson's lot size formula in economics, the most economical quantity Q of goods (TVs, dresses, gallons of paint, etc.) for a store to order is given by Wilson's lot size formula

Q = f(K, M, h) = √(2KM/h)

where K is the cost of placing the order, M is the number of items sold per week, and h is the weekly holding cost for each item (the cost of storage space, utilities, taxes, security, etc.). Find f(200, 625, 1) and interpret your answer.

Reference no: EM131801415

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