What inventory model do you propose

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Reference no: EM131797806

Daily demand for a certian product is normally distributed with a mean of 100 and a standard deviation of 15. The supplier is reliable and maintains a constant lead time of 5 days. The cost of placing a order is $10 and the cost of holding inventory is $0.50 per unit per year. Sales occur over 360 days of the year. Your goal is to find order quantity and reorder point to satisfy a 95 percent profitability of not stocking out during the lead time.

A) What inventory model do you propose?

B) What is the order quantity?

C) What is the reoder point?

D) What is the average inventory level then?

Please show all steps

Reference no: EM131797806

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