#$1.$ Annual demand is $74000$ per year. Holding cost, $h,$ is $$1\mathrm{.}89$ per unit per year, and

ordering cost, $S,$ is $$175$ per order. Manager, using continuous review inventory model,

currently orders $5000$ units every time she$/$he places an order.

$($a$)$ How many times she$/$he places orders annually? What is the annual holding cost

$HC,$ the annual ordering cost SC and the total cost TC$?$

$($b$)$ What is the optimal order quantity to minimize TC$?$ What is TC$?$

#$2.$ The daily demand for an item is $48$ with a standard deviation $16.$ Currently the

manager orders inventory every three weeks, and the lead time is $4$ days. The service

policy is $97\%.$

What is the required inventory, $?$ If currently there are $129$ units in the store, how many

should the manager order?