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A product has a reorder point of 2 5 0 units and is ordered ten times a year. The following table shows the historical distribution
A product has a reorder point of units and is ordered ten times a year. The following table shows the historical distribution of demand values observed during the reorder period.
tableDemandProbabilityrop
Currently, stockouts are valued at $ per unit per occurrence, while inventory carrying costs are $ per unit per year. Should the firm add safety stock? If so how much safety stock should be added?
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