Reference no: EM132735896

A hospital orders surgical supplies using a fixed order interval system. Suppose that just prior to ordering, a check of rolls of gauze bandages shows that there are 40 currently on hand. Suppose also that these rolls have a daily usage that is approximately normal with a mean of 9 rolls and a standard deviation of 4 rolls. Lead time is 4 days and the desired service level is 98 percent. The order interval is 12 days.

1. How many rolls of gauze bandages should be ordered for this period?

a. 13 rolls
b. 33 rolls
c. 53 rolls
d. 137 rolls

2. How many units would be the safety stock?

a. 13 rolls
b. 33 rolls
c. 53 rolls
d. 137 rolls

3. What's the expected demand during the order interval and lead time?

a. 33 rolls
b. 53 rolls
c. 137 rolls
d. 144 rolls

4. What would have been the desired service level if an order quantity of 142 rolls were placed when the stock on hand is 30 rolls? (Assume: amount on order and backorder is zero).

a. 95%
b. 96%
c. 97%
d. 99%