What is the associated order policy

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Consider the following for a purchased item.

time between reviews= 3 months

lead time= 2 months

unit cost= $590/unit

cost of capital= 20%

demand= 2773 units/year with

standard deviation= 84 units/year

desired cycle service level is 99.9%

ordering cost is insignificant

A. What is the associated order policy?

B. It is now the end of a review cycle. You are expecting a previously ordered shippment of 520 units to arrive within a week and you physcally have 493 units on hand. Considering the policy you developed in part A nowo, how many, if any at all, should you now order ?

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