The manager at a large kitchen manufacturing company is planning warehousing needs for the coming year. She

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The manager at a large kitchen manufacturing company is planning warehousing needs for the coming year. She predicts that warehousing needs will be normally distributed, with a mean of 300,000 square feet and a standard deviation of 125,000. The manager can obtain a fullyear lease at €0.75 per square feet per month or purchase storage space on the spot market. Spot market rates have averaged €0.90 per square feet per month. How large an annual contract should the manager sign?

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