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At one of its maintenance facilities, National Airlines stocks radar displays that are used in the cockpit of its CityHopper regional jets. While these displays
At one of its maintenance facilities, National Airlines stocks radar displays that are used in the cockpit of its CityHopper regional jets. While these displays are generally quite reliable, National has a large fleet of CityHoppers and on average, weekly demand for replacements is 1.2 displays, and demand follows a Poisson distribution. Lead time for displays is 6 weeks, and National uses a periodic review order-up-to policy with a review period of 1 week and an order-up-to-level of 9 displays. a) Find the average on-order inventory for these displays. b) Find the average on-hand inventory for these displays. c) What is the stockout probability? d) Now suppose that National wants to maintain at least an in-stock probability of 0.916 while not having more on hand inventory than required to achieve that. What order-up-to level should they use
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