Question: Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. item cost $10.00 standard deviation of order cost

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. item cost $10.00 standard deviation of order cost $250.00 weekly demand 25 per week Annual holding cost(%) 33% of item cost lead time 1 week Annual demand 25,750 service probability 95% Average demand 515 per week

1. Determine the annual holding and order costs 2. If a price break of$50 per order was offered for purchase quantities of over 2,000would you take advantage of it? How much would you save annually?

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