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To set an ordering and inventory management policy, the owner of a small household appliances store in Florya examines the demand behavior of his customers.

To set an ordering and inventory management policy, the owner of a small household appliances store in Florya examines the demand behavior of his customers. He finds that uring a typical week the probability that customers demand 1 refrigerator is 1/5, the probability that the customers demand 2 refrigerators is 2/5, the probability that the customers demand 3 refrigerators is 1/5, and the probability that the customers demand 4 refrigerators is 1/5. To satisfy the customer demands he thinks of ordering enough refrigerators to bring next weeks's beginning inventory to 3 units if the ending inventory is less than or equal to l unit. In addition, he lists the following costs for this management policy: It costs 3000 TL to order a refrigerator and 300 TL to hold a refrigerator in inventory for a month. Also, for each of the demand that cannot be satisfied, a shortage cost which follows a normal distribution with mean 1200 TL and standard deviation 200 TL occurs. If he follows this policy, what is the average weekly ordering and inventory management cost for this.

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