Question
A construction supply company adopts an reorder point policy to replish its cement inventory. The company orders replishment whenever there are 800 bags of cement
A construction supply company adopts an reorder point policy to replish its cement inventory. The company orders replishment whenever there are 800 bags of cement left (current reorder point policy). It estimates, from past experience, the demand during the waiting period for delivery follows a normal distribution with a mean of 620 bags and standard deviation of 104 bags.
(1) What is the safety stock level under the current reorder piont policy? bags. (integer value)
(2) What is the service level (in percentage, remember to multiply by 100) adopted by the company? % [two decimal places]
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