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?Beauty&TheBeatz (B&B) sells and installs car audio systems. The weekly demand for car audio systems follows a normal distribution with mean 65 systems per week and standard deviation 77 systems per week.? B&B reviews its inventory every 21 days. It takes 14 days to receive an order delivery? (assume 7 days per? week). B&B would like to maintain a service level of 95?%.? B&B purchases the systems from a supplier for ?$110 per system. Annual holding cost is 20?% of the purchase cost per audio system. You may use the following table of values for the Standard Normal distribution to find your z value.
?a) Compute the safety stock level you recommend for? B&B.
?b) Compute average inventory on order
?c) Compute the annual holding cost for carrying the safety stock
Operations Management is about a book review. Title of the book is "Goal". This book has been written by Dr. Eliyahu Goldartt. The book has been appreciated by many as one of those books which offers an insight into the operations and strategic capac..
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An analysis of the holding costs, including the appropriate annual holding cost rate.
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