I'm learning operations research and this is a question that I came across:
The monthly demand for your family is 10kg, which is bought monthly. The maximum retail price (MRP) is INR400, on which generally there is a discount of 20%. But due to a pandemic situation, you are expecting that the flour would be sold on MRP in the coming months. Today, 20% discounted wheat flour is available in the local grocery store. Based on the learning in your operations management course, suggest the right amount of wheat flour be purchased this time. (Wheat flour should be used within 3 to 4 months of preparation).
I'm a bit confused because this seems alarmingly simple. Nothing is mentioned about the holding constraints of flour inventory, so shouldn't I just buy 30-40kg of wheat at this discounted price to last for the next 3-4 months (while the flour hasn't gone bad.)
Or should I rethink this and devise different cases and scenarios for different holding cost situations? Very perplexed on how to go about this question. Apologies if it is too basic (stupid) a question.