Fixed setup cost of ordering

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Reference no: EM131278200

Assume the following cost data is given for two items, X and Y, where A is the fixed setup cost of ordering (S), D is the demand per year (unit/year), v is the unit cost ($/unit) and v is the inventory carrying rate ($/$/year). Assuming that both X and Y have a shelf life of 1 month, what are the optimal order quantities for X and Y? Note that, an item deteriorates and cannot be used after its shelf life is over.

Reference no: EM131278200

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