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Unformatted text preview: = # of batches of items made = fixed set up costs to make each batch of the product $ cost / unit = total number produced each year. _____________________________ = cost to store 1 unit (batch) for one yearA market has a steady demand for 16,800 cases of sugar. It costs $3 to store a unit for 1 year, and the market pays $7 for each order that is placed. [Think setup price = order costs.] Find the number of orders of sugar that should be placed each year. [ to minimize costs, of course]A restaurant has an annual demand for 900 bottles of a California wine. It costs $1 to store 1 bottle for 1 year. and it costs $5 to place a reorder. Find the number of orders that should be placed annually....
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 Fall '10
 Yost
 Optimization, Minimum Total Cost

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