A greengrocer has exactly 1,000 square feet (sqf) available to display and sell 3 kinds of vegetables.
Question:
A greengrocer has exactly 1,000 square feet (sqf) available to display and sell 3 kinds of vegetables. The ratios of each vegetable space -per-pound to cost-per-pound are the same for all vegetables, and tomatoes consume 0.5 sqf per pound. There is a $100 setup cost for replenishing any of the vegetables, and the interest rate is 25% per annum. The 3 vegetables for sale have the following data:
Tomatoes : annual demand is 850 pounds and the cost per pound is $0.29 .
Lettuce: annual demand is 1280 pounds and the cost per pound is $0.45 .
Zucchini : annual demand is 630 pounds and the cost per pound is $0.25 .
What is the optimal quantity for purchasing each vegetable (include model name and all formulas )?
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw