Storage Decisions 15. The price at harvest is $4.50. You are planning to store for 5 months. The amount to be stored is 40,000 units. The insurance per unit is estimated at $.05 per unit. The spoilage loss rate is 3%. The interest rate is 5%. Your forecast is that if you store, the market price will be $5.50 in 5 months. Should you store or sell now? (15 pts) Price at Harvest (Ph) $4.50 40,000 units Amount at Harvest (oh) Revenues if Sold at Harvest (Ph*Qh) Price if Store (Ps) $5.50 $/unit Spoilage Loss Amount (SL) Units Amount after Store (Qs-SL) Units Revenues after Storage, With Storage Loss Rs=Ps*(Qs-SL) Insurance Costs (INS) % in Decimal Revenues After Storage and Insurance Costs (Use as Future Value, FV) FV=Rs-INS Annual Interest Rate (1) Monthly Interest Rate (MI=1/12) Discounted Value DV=FV/(1+MUN n=number of time periods stored Store (Yes or No) % in Decimal Yes/No Show DV Calculations Here: DV=FV/(1+MI) =