Question #1
Taking into account that we have a business where units take time to produce and storage is expensive, we need to identify where a huge number of these units can be produced and stored in order to keep up with the future demand . However, it is not possible to do this, since storage cost is significantly high. Hence, the total cost is directly proportional to the storage cost. Companies are doing everything possible to reduce the total production cost according to the theory of inventory management.
Companies are also facing lost sales if the demand unexpectedly goes up and ...