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Given : Set up cost = Rs. 50 / cycle  Storage cost = Rs. 3 / item/ year  Demand = 5000 items/year 

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Given : Set up cost = Rs. 50 / cycle 

Storage cost = Rs. 3 / item/ year 

Demand = 5000 items/year 

Calculate ‘minimum average inventory cost’.

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Given R = 5000 items / year 

C1 = Rs. 3 / item / year

 C3 = Rs. 50/ cycle 

Minimum average inventory cost is :

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