Question
To prepare pizzas, a restaurant needs to order bags of flour, priced at $100 per bag, from its supplier. Say, it costs $200 to prepare
To prepare pizzas, a restaurant needs to order bags of flour, priced at $100 per bag, from its supplier. Say, it costs $200 to prepare placement of an order each time, and it costs $4 to hold a bag of flour per year. The supplier can deliver the order 3 days after it receives the order. Further, assume that the restaurants annual (deterministic) demand is 10,000 flour bags. Assume 300 working days in a year. What is the optimal inventory management policy for the restaurant ? And, what is this minimized annual inventory cost? Enter numeric values only.
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