Calculates the optimal inventory level for uncertain demand for a perishable product.

The demand follows a uniform distribution (continuous) between Dmax and Dmin.

Formula: dMin+(dMax-dMin)*((fcprice-fccost)/fcprice)

Q: The optimal inventory level.

price: The retail price.

cost: The purchase price.

Dmax: The maximum demand

Dmin: The minimum demand

For a retail price of $7, a cost of $5 and a uniform demand between 80 and 50 units, calculate the optimal inventory.

Value | Key | Display | Description |
---|---|---|---|

50 | Dmin | 50.00 | Stores the minimum demand. |

80 | Dmax | 80.00 | Stores the maximum demand. |

5 | cost | 5.00 | Stores the purchase price. |

7 | price | 7.00 | Stores the retail price. |

Q | 58.57 | Calculates the optimal inventory level. |

Also see:

Newsvendor Model for a Normal Distribution Formula Calculator

Newsvendor Model for a Lognormal Distribution Formula Calculator

Reference: Newsvendor Model - Wikipedia