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Annual demand for GE washing machines at ABC Warehouse is Normally distributed with a mean of 520 and a standard deviation of 100 . Whenever

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Annual demand for GE washing machines at ABC Warehouse is Normally distributed with a mean of 520 and a standard deviation of 100 . Whenever ABC orders from GE, there is a fixed setup cost of $2,500 per order and each washer costs $200. Delivery lead time is four weeks. ABC likes to ensure a 98% service level. The annual unit holding cost is $40/ unit/yr. Assume that there are 52 weeks per year. Compute the optimal inventory policy (EOQ, ROP). a. EOQ(2pts) : b. ROP (2 pts): c. How much average inventory does ABC keep? What is the annual (total) holding cost? What is the annual (total) setup cost? (2 pts)

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