An import/export firm has leased 20,000 cubic feet of storage space to store six items that it imports from the Far East. The relevant data for the six items it plans to store in the warehouse are Annual Demand Space per Unit Item (units) Cost per Unit (feet3)

DVD 800 $200.00 12 32-inch flat screen TV 1,600 150.00 18 Blank DVD’s 8,000 30.00 3

(box of 10)

Blank CD’s 12,000 18.00 2

(box of 50)

Compact stereo 400 250.00 24 Telephone 1,200 12.50 3 Setup costs for each product amount to $2,000 per order, and holding costs are based on a 25 percent annual interest rate. Find the optimal order quantities for these six items so that the storage space is never exceeded. (Hint: Use a cell location for the Lagrange multiplier and experiment with different values until the storage constraint is satisfied as closely as possible.)