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King Kong Electronics, a manufacturer of consumer electronic goods with headquarters in Italy, has a distribution center (DC). Company sells a high-speed cable modem. The price of each modem is $120. The average weekly demand for it at the DC is 200 units. Average shipment size to DC is 1,000 units, and average lead-time for delivery is three weeks. The DC carries two week’s supply as safety stock.
How much total inventory (in cycle, safety, and pipeline) does King Kong Electronics hold at the DC in number of units? In amount of dollars?
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