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Compute the safety stock resulting in the lowest cost

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Reference no: EM132891951

Problem - Safety stock. For product 6F, ordered five times per year, stock out cost per year occurrence is P and safety stock carrying cost is 3 per unit. Available options are:

Units of safety stock

Probability of running out of safety stock

10

50%

20

40

30

30

40

20

50

10

55

3

Required - Compute the safety stock resulting in the lowest cost.

Reference no: EM132891951

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