A high-tech manufacturing company in Hong Kong called HK is purchasing color displays to be used in its digital video recorders. The displays are coming from north of China and it takes 3 weeks to receive any order from the vendor. The weekly demand of displays is approximately normally distributed with mean of 38 and a variance of 130. Each display costs $18.80 and there is an ordering cost of $75 regardless of the size of the order. The company uses a stock-out cost of $400 per display and 40% of annual interest rate is used to compute holding costs. HK works 52 weeks in a year.