Dynamic Lot Sizing The dynamic lot-size model in inventory theory, is a generalisation of the Economic Order Quantity (EOQ) model that takes into account that demand for the product miss over time. Dynamic lot sizing sometimes refers to as Time-Varying DemandI as well. In contrast to EOQ model where demand is constant, in the time-varying deterministic demand model, demands of various periods are unlike. The variations can depend on diEerent reasons. For example, production on a contract, which requires that certain quantities are delivered on specied dates. Note that we are still considering deterministic demand, i.e., all variations are known in advance. In the basic models, lead-time is disregarded. When dealing with lot sizing for time-varying demand, it is generally assumed that there are a nite number of discrete time steps, or periods. A period may he, for example, 1 day or a week. We know the demand in each period, and for simplicity, it is assumed that the period demand takes place at the beginning of the period. There is no initial stock. When delivering a hatch, the whole hatch is delivered at the same time. The holding cost and the ordering cost are constant over time. No hackorders are allowed. We shall use the following notation: Var Denition T = number of periods, (1,- = demand in period i, 12 = 1, 2, ...,T, 06' = ordering cost, H C = holding cost per unit and time unit. Problem Costco has received the following demands for a product in 2021]: Month 1 2 3 4 5 l3 7 3 9' 10 11 12 Demand SUI] TDD 800 900 3300 200 EDD 9GB 200 300 1000 800 Suppose ordering cost (DC) is $504 and holding cost (HG) of one unit of product in a year is $3. There is no shortage cost. Backordering is not allowed in this model. To achieve the minimum total cost {ordering cost + holding cost}, how many times the company should place orders in a year? In each order, how many products should be ordered? What is the total cost in a year