An Inventory Control Model
An Inventory Control Model
This Demonstration models the inventory size and inventory costs of a business that receives regular deliveries. You control the cost, size, and frequency of deliveries. Assume that the business sells its inventory at a constant rate, so adjusting the annual sales slider will affect the rate at which inventory is depleted. The top image shows the behavior of inventory over time, with the average inventory marked by the horizontal gold line. The bottom image shows the evolution of delivery and carrying costs over the course of the year.