Question: In a typical periodic - review case, it is assumed that the annual demand is 1 0 , 0 0 0 units. The cost of
In a typical periodicreview case, it is assumed that the annual demand is units. The cost of making a review is $ and the cost of placing an order is $ The cost per unit is $ the carrying cost is $ per unit per year, and the shortage cost is $ per unit independent of duration. It is found that the demand during is represented by a normal distribution with a mean and a variance Determine the optimal values of and the lead time is months Assume that shortages are lost sales.
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