Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

answers in boxes were wrong. The annual demand for a product is 16,000 units. The weekly demand is 308 units with a standard deviation of

image text in transcribed

answers in boxes were wrong.

The annual demand for a product is 16,000 units. The weekly demand is 308 units with a standard deviation of 80 units. The cost to place an order is $30.50, and the time from ordering to receipt is six weeks. The annual inventory carrying cost is $0.10 per unit. a. Find the reorder point necessary to provide a 95 percent service probability. (Use Excel's NORMSINV() function to find the correct critical value for the given a-level. Round " z " value to 2 decimal places.) b. Suppose the production manager is asked to reduce the safety stock of this item by 50 percent. If she does so, what will the new service probability be? (Use Excel's NORMSDIST() function to find the correct probability for your computed Z-value. Round "z" value to 2 decimal places and final answer to 1 decimal place.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Understanding And Managing Public Organizations

Authors: Hal G. Rainey

4th Edition

047040292X, 978-0470402924

More Books

Students also viewed these General Management questions

Question

=+ (b) Shows that Q agrees with P on Fo.

Answered: 1 week ago