# carrying charge

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Related to Holding cost: Ordering Cost, Shortage cost
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Now there's a holding cost -- the hope is it will change the way people perceive real estate as an asset class.
1982, Economic Order Quantity models with nonlinear holding cost, European Journal of Operational Research, 9, 56-60.
If the value of Y is high, holding cost will be high, but shortages cost will be low.
Inventory holding cost (IHC) is the variable cost of keeping inventory on hand, and is a combination of the costs associated with opportunity costs, storage, taxes, insurance, shrinkage, and other variables.
ij] Unit holding cost of operation j of part i for one time period, where [H.
An EPQ model has been developed for a single machine producing single item considering linear deterioration and variable holding cost with respect to time.
o] is cost per order, I is annual holding cost expressed as a percent of an item cost, c is an item cost, [pi] is a penalty cost per item, and p(x) is probability that demand is equal to x.
Due to the finiteness of production rate, holding cost is calculated by the area under the inventory curve.
We allow for shortages and complete backlogging, and assume that the inventory cost (including holding cost and deterioration cost) in RW is higher than that in OW.
From this graph you can see that: the total holding cost rises linearly with order size, the total reorder cost falls as the order quantity increases, large infrequent orders give high total holding costs and low total reorder costs, small frequent orders give low total holding costs and high total reorder costs, adding the two costs gives a total cost curve that is an asymmetric 'U' shape with a distinct minimum; this minimum cost shows the optimal order size--which is the economic order quantity, EOQ.
Our model allows for price elasticity, accounts for a various types of inventory holding costs, and deals with obsolescence costs and capital costs separately from the holding costs.
For example, with the holding cost accrual function, users can analyze options on equities, futures, bonds, foreign currencies (Garman-Kohlhagen model) and commodities.

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