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Calculate the necessary safety inventory

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Reference no: EM133020537

Question - The daily demand for a product is 120 units, with a standard deviation of 30 units. The inventory is reviewed every 14 days and the time it takes the supplier to deliver an order is 7 days. They work 52 weeks a year, each one of 5 days.

a) Calculate Losses for 624 units are accepted annually, obtain the level of service.

b) Calculate the necessary safety inventory to maintain the level of service.

c) Obtain the target inventory level (ROP).

Reference no: EM133020537

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