how do i go about this ?The demand for motorcycle tires imported by Dixie Import-Export is 47,000/year and may be assumed to be uniform throughout the year. The cost of ordering a shipment of tires is $470, and the cost of storing each tire for a year is $2. Determine how many tires should be in each shipment if the ordering and storage costs are to be minimized. (Assume that each shipment arrives just as the previous one has been sold.)thanks
The cost per year is the cost of shipping plus the cost of storing the tires. Assume you have x shipments per year, which means 1/x years passes between shipments. This means the cost of shipping is the $470 per shipment * x shipments is 470x. The cost of storing is $2 per year * portion of the year each tire is stored on average * 47,000 tires. And the portion of the year each tire is stored on average is 1/x / 2 (some sell right away, some have to be stored until just before the next shipment.on average, they are half way between these two times). So, in formula, the cost 470x + 2*(1/x/2)*47000 470x + 47000/x. From there, you should be able to use your calc background to solve. Good luck.
