In the order-up-to model, assume that the mean of demand in a period remains the same and

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In the order-up-to model, assume that the mean of demand in a period remains the same and the target in-stock probability is kept at a constant level. If the demand uncertainty (the standard deviation of demand in each period) increases, then

a. Expected on-hand inventory increases.

b. Expected on-hand inventory decreases.

c. Expected on-hand inventory remains the same.

d. Expected on-hand inventory may increase or decrease, depending on the demand distribution and other parameters.

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Operations Management

ISBN: 9781260547610

2nd International Edition

Authors: Gerard Cachon, Christian Terwiesch

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Question Posted: Aug 13, 2020 05:39 AM

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In the order-up-to model, assume that the mean of demand in a period remains the same and

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Operations Management

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