Inventory Class Notes Handout/Clarification on TA#2

Dear E204-1, E204-2 Students,
I have attached a handout on Inventory Management that parallels my
lectures and the readings (but does not cover some models, like MRP
-- Materials Requirement Planning, which is in the reading handout).
This was requested by class rep Erik Magner. I have tried to include
all the square roots as ( ... )1/2 but compare to the formulae in the?readings for accuracy/equivalence.?Regarding Team Assignment #2, "End of Month Cash Balances" refer?to the end of the month AFTER any loan that is needed. The 0.5% interest?is only earned on the end-of-month cash flow BEFORE the loan, however?(0.5% of any pre-loan positive balance is paid to McGan, and McGan pays?the bank 0.5% of any pre-loan negative cash balance -- in addition to the?1% interest charge on any loan needed). McGan's end-of-month?cash balance should be at least $250,000 (after any loan) in any month.?These comments refer to the last two bullet-points of Problem 2, p. 3.?--Tom McCullough? - E204_INV_hndout.doc??=======================================================================?Tom McCullough?Senior Lecturer?Haas School of Business?University of California at Berkeley?==========================================================================