Question
Mel is planning to make her monthly (every 30 days) travel to Antrim Crescent Place to pick up a supply of chips. The trip will
Mel is planning to make her monthly (every 30 days) travel to Antrim Crescent Place to pick up a supply of chips. The trip will take Mel about 4 days. Before she leaves, she calls in the order to the Marketplace. She sells chips at an average rate of twelve per day (seven days per week) with a standard deviation of demand of four per day. She needs a 90 percent service probability.
a)If she currently has 35 chips in inventory, how many should she order? (Using Excel's Normsinv function to find the critical value. What is the normal distribution?
b) The most she would ever order would be when on-hand is zero.
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