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Total Wine is planning to open a megastore in a suburban town. There are currently 9 small stores selling 1.5L bottles of wine. Each store experiences identical supply/demand behavior: Mean demand of 54 bottles/week. The standard deviation of the demand 18 bottles/week is given to you. The supply lead time is 4.2 weeks, and the target service level is 90%.
i. What is the safety stock for each of the small stores?
ii. What is the Big-Box safety stock advantage of Total Wine?
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