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A landscaping business sells large quantities of mulch. Daily demand for mulch at the store is found to be normally distributed with mean 50 lbs.
A landscaping business sells large quantities of mulch. Daily demand for mulch at the store is found to be normally distributed with mean 50 lbs. and standard deviation 5 lbs. When the store orders more mulch, the ordering cost is $42, and the orders take four days to arrive. Each pound of mulch costs $7.20, and there is a 24% annual holding cost for inventory. Assume the store is open 360 days a year. If the store wants the probability of stocking out to be no more than 5%, and demand each day is independent of the day before, what reorder point should be set
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