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Suppose management decides to relax the policy about stockouts on a month-to-month basis. Instead, they just want to make sure that they end the entire
Suppose management decides to relax the policy about stockouts on a month-to-month basis. Instead, they just want to make sure that they end the entire five-month planning period with a zero balance on inventory. They have never worked this way before and don't have an idea what it costs to stockout, so they assign a value of $0 for each unit stocked out. What is the optimal planning period cost?
$40,225
$45,220
$45,520
$42,250
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