Inventory: The yearly inventory expense E, in dollars, of a car dealer is a function of the number Q of automobiles ordered at a time from the manufacturer. A dealer who orders only a few automobiles...



Inventory: The yearly inventory expense E, in dollars, of a car dealer is a function of the number Q of automobiles ordered at a time from the manufacturer. A dealer who orders only a few automobiles at a time will have the expense of placing several orders, whereas if the order sizes are large, then the dealer will have a large inventory of unsold automobiles. For one dealer the formula is


so E is a rational function of Q.


a. Make a graph of E versus Q covering order sizes up to 10.


b. Explain in practical terms the behavior of the graph near the pole at Q = 0. (Hint: Keep in mind that there is a fixed cost of processing each order, regardless of the size of the order.)



May 06, 2022
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