Ch$.9.$ Inventory Practice Problems

The Discount Appliance Store uses a continuous review system $(Q$ system$).$ One of the company's items has the following characteristics:

Weekly demand $=10$ units$/$wk $($assume $52$ weeks per year$)$

Ordering and setup cost $(S)=$$$\frac{45}{?}$ order

Holding cost $(H)=$$$\frac{12}{?}$ unit$/$year

Lead time $(L)=3$ weeks $($constant$)$

Standard deviation in weekly demand $=8$ units

Cycle$-$service level $=70\%$

A$)$ What is the EOQ for this item?