Question
Canola oil is one of the primary ingredients for Michael fast-food restaurants. The restaurant's operations will be stopped if an oil shortage occurs. The daily
Canola oil is one of the primary ingredients for Michael fast-food restaurants. The restaurant's operations will be stopped if an oil shortage occurs. The daily demand for oil is normally distributed, with an average of 20 gallons and a standard deviation of 4 gallons. The lead time required to receive an order of oil from the local distributor is 12 days.
Determine the reorder point if the restaurant wants to maintain a 90% service level. Round to 2 decimal places.
By how much would safety stock increase if the service level increased from 90% to 95%? Round to 2 decimal places.
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