Consider the following two-echelon inventory system. There are two depots at the lower echelon and one distribution center at the upper echelon. Demand is deterministic with a constant rate. Backordering is not allowed. Consider the following parameter setting:

What is the cost incurred per unit time for this inventory system? Be careful with the "system inventory" level for depot 1 and depot 2. It may not have the zero inventory property.

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Replenishment cost Locationemand per wek CydtiHolding cos er order 4 weeks and 2 veeks altenating 2 weeks 10 16 .5 Distribution center 0.5/unit 2unit 1/unit Depot 2 o weeks