Daily demand of a milk product is normally distributed with a mean of 100 units and standard deviation of 5. The lead time is 5 days. The ordering cost is $10 and holding cost is $0.50 per unit annually. Find out the order quantity and reorder point to satisfy a 98 percent probability of not stocking out during the lad time. Assume that sales occur over the entire period of 365 days of the year.

Show all your calculations