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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 refrigerator is the probability that the customers demand refrigerators is the probability that the customers demand refrigerators is and the probability that the customers demand refrigerators is To satisfy the customer demands he thinks of ordering enough refrigerators to bring next weeks's beginning inventory to 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 TL to order a refrigerator and 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 TL and standard deviation TL occurs. If he follows this policy, what is the average weekly ordering and inventory management cost for this.
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