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Problem 1.
Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year.
Last Year
Item cost $10.00
Order cost $250.00
annual hold cost (%) 33% of item cost
Annual demand 25,750
average demand 515 per week
Standard deviation of weekly demand 25 per week
lead time 1 week
service probability 95%
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