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A truck company uses petrol at a rate of 15,000 litres per month. Petrol costs 65 cents per litre with an ordering cost of $600.
A truck company uses petrol at a rate of 15,000 litres per month. Petrol costs 65 cents per litre with an ordering cost of $600. The holding cost for the petrol is 2 cents per litre per month. (a) (5 points) If shortages are not allowed, determine the size of each order and how often they should be made. (b) (5 points) If shortages cost 40 cents per litre per month, determine the size of each order and how often they should be made
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