Production quantity subject to the shelf life constraint

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A manufacturer produces a product that is perishable. He feels that the maximum time he can hold a unit in inventory is two weeks. He produces in batches and the process is such that the entire batch is completed and added to inventory at one time. The annual demand rate is 5,200 units. The fixed cost of setting up for production is 400 TL, the inventory carrying costrate is 0.20 per year, the unit variable cost is 100 TL, and no shortages are allowed. Find the economic production quantity subject to the shelf life constraint.

Reference no: EM131375708

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