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A distributor of computer monitors purchases the monitors from an overseas supplier under a continuous revieew system. The average demand for a popular computer monitor
A distributor of computer monitors purchases the monitors from an overseas supplier under a continuous revieew system. The average demand for a popular computer monitor is normally distributed with a mean of 50 units a day and a standard deviation of 10 units a day. it cost $75 to process each order and there is a 16 day lead time. The holding cost for each monitor is $20 per year and the distributer wishes to maintain a 90% service level. The distributor operates 300 days in a year.
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