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We control the inventory of a product over 3 time periods. The inventory capacity is 3 , and demand can take values 0 , 1
We control the inventory of a product over time periods. The inventory capacity is and demand can take values or with probabilities and respectively. For each unit sold we generate a revenue of $ and for each unit ordered we incur a cost of $ Every time we place an order we incur a fixed cost $ Unit inventory holding cost is $ and demand that is not satisfied is lost with no penalty cost. If the initial inventory level at the beginning of time period is units, what is the optimal total expected profit over the whole planning horizon?
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