10 The annual demand for a product is 15,600 units. The weekly demand is 300 units with...
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10 The annual demand for a product is 15,600 units. The weekly demand is 300 units with a standard deviation of 90 units. The cost to place an order is $31.20, and the time from ordering to receipt is four weeks. The annual inventory carrying cost is $0.10 per unit. Find the reorder point necessary to provide a 98 percent service probability. Suppose the production manager is asked to reduce the safety stock of this item by 50 per- cent. If she does so, what will the new service probability be?
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Operations Management For Competitive Advantage
ISBN: 1572
11th Edition
Authors: Richard B. Chase, F. Robert Jacobs
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