Consider an item with the following declining demand pattern:

Period 1 2 3 4 5 6 7 8 9 10 Demand 600 420 294 206 145 101 71 50 35 25 Period 11 12 13 14 15 16 17 18 19 20 Demand 17 12 9 6 5 3 2 2 1 1 There is no further demand after period 20.

A = $50 v = $2.50/unit r = 0.02 $/$/period Perform an analysis similar to that of Problem 5.4.