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A 1 Auto Parts stocks standard car batteries according to the following policy: every time inventory drops to 2 0 , order 3 0 .
A Auto Parts stocks standard car batteries according to the following policy: every time inventory drops to order The daily demand is Normally distributed with a mean of and a standard deviation of and the lead time is days. The holding cost is $ per day.
What is the imputed cost of understocking, if unmet demand is backordered? What does this mean?
After interviewing the manager, you discover that whenever a standard battery is backordered, the salesperson will substitute a different, higherquality battery for the customer, which costs the firm an extra $ Given this information, how should A change their reorder point?
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