A community hospital in Southeast Ohio consumes 1,000 boxes of bandages per week. The price of bandages is $35 per box, and the hospital operates 52 weeks per year. The ordering cost is $15, and the cost of holding one box is 15% of the price of the material. The lead time to receive materials is 2 weeks.

f) If the hospital uses a periodic review system, with the review period (P) equal to 2 weeks and cycle-service level of 97%:

i. What would be the target inventory level, T? (Use the original information from part e)

ii. What is the cost of using the periodic review system? iii. Compare/Contrast the continuous review system and periodic review system in terms of safety stock and costs. What are the managerial implications of each?