Berol Company plans to sell 200,000 units of finished product in July and anticipates a growth rate in sales of 5% per month. The desired monthly ending inventory in units of finished product is 80% of the next month's estimated sales. There are 150,000 finished units in inventory on June 30. Berol Company's production requirement in units of finished product for the three-month period ending September 30 is.

Total production requirements for 3 months = 665720 units

Explanation:

The opening inventory in July should have been 200000 * 0.8 = 160000 units

However there is a shortage of 10000 units as opening inventory is 150000 units.

The production requirement is to produce enough to match this month's sale along with 80% of next months sale.

The production requirement for 3 months ending 30 september will be,

Total production requirements for 3 months = 218000 + 218400 + 229320 = 665720 units

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answer; normative economics;