Copyright © University of Cambridge. All rights reserved.

'Production Equation' printed from

Show menu


Each week a company produces $X$ units and sells $p$ per cent of its stock. How should the company plan its warehouse space? Will the stock fluctuate, or increase or decrease over time, or tend to a limit?

Initially the company has no stock. Show that, over a long period of time, the amount of stock tends to the limit ${100X\over p}$.