Expected demand during lead time

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Reference no: EM132216108

Given this information:

Expected demand during lead time = 295 units

Standard deviation of lead time demand = 20 units

Use Table.

Determine each of the following, assuming that lead time demand is distributed normally:

a. The ROP that will provide a risk of stockout of 2 percent during lead time. (Round your answer to the nearest whole number.)

ROP   _______ units

b. The safety stock needed to attain a 2 percent risk of stockout during lead time. (Do not round intermediate calculations. Round your answer to the nearest whole number.)

Safety stock  _______ units

c-1. Would a stockout risk of 1 percent require more or less safety stock than a 2 percent risk?

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Reference no: EM132216108

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