Question: using the formula, Holding Cost = h*area I store product in my warehouse. If I purchase and ship it out at a rate of 5,000
I store product in my warehouse. If I purchase and ship it out at a rate of 5,000 units per month. When I receive the products, I mar time stamps on them and know each unit stays in my warehouse for about 3.7 weeks. When each product stays in my warehouse, its inventory holding cost (sum of the interest of the product cost and overhead costs such as rental space cost and insurance cost) is $20 /unit/year, how much inventory holding cost occurs to me per month? Use time unit of month in your calculation. Let one month be 4.3 weeks and one year be 4.312=51.6 weeks
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