9/assignments/105149 t bookmarks now ring 2018)> Assignments> Section 2.5 Optimi
ID: 2886492 • Letter: 9
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9/assignments/105149 t bookmarks now ring 2018)> Assignments> Section 2.5 Optimization 2 ptimization 2 5 Optimization 2 This assignment is past the original due date of Wed o3/28/2018 1159 pm. You were granted an extension Due Thu 04/05/2018 10.00 am A grocery store orders frozen ples in batches from a bakery and sells them in the grocery store. Storing one frozen pie for a year costs $1.25. When the grocery store reorders pies, there is a fixed cost of $4.25 per order as well as $0.85 per ple. Each year, they sell 1750 frozen pies. What is the optimal number of pies to order in each order to minimize their total inventory costs Get help: Written Example Points possible: 10 This is eitempa 1 of 5 Submit SAMSUNGExplanation / Answer
Let
x = number of items per order.
Yearly cost = 1.25*(x/2) =0.625x
Yearly reorder cost = (4.25+0.85x) *1750/x
Total cost C(x)=0.625x +(4.25+0.85x) *1750/x
Find derivative
C'(x) =0.625 - 7437.5/x^2
Set to 0 as
x² =7437.5/0.625
x² =11900
x is about 109
Hence optimum number of pie per order is 109.
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