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The computer company starts each period with 4,000 CPU's (Central Processing Units) in stock. The stock is depleted each month and then re-ordered. If the

The computer company starts each period with 4,000 CPU's (Central Processing Units) in stock. The stock is depleted each month and then re-ordered. If the carrying cost per CPU is $1, and the fixed order cost is $10, is the company following an economically advisable strategy? If not, what should they be doing? When is it optimal and why (be sure to show the breakdown between carry and restock costs)? (8 marks)

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