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PA 14-11 (Algo) Soap and Towels is a retailer of home goods... Use Appendix 14A, Soap and Towels is a retailer of home goods. They
PA 14-11 (Algo) Soap and Towels is a retailer of home goods... Use Appendix 14A, Soap and Towels is a retailer of home goods. They receive inventory from their supplier with a 2-week lead time. Assume they order weekly, and they use the order-up-to model for choosing base stock levels. Weekly demand for a merino towel can be modeled with a poisson distribution with mean 0.6 . (Round your answer to 2 decimal places. Use Poisson distribution and Appendix 14A.2.) a. Say they operate with a base stock level of 5 . What is their expected onhand inventory? (Round your answer to 4 decimal places. Use Poisson distribution and Appendix 14A.2.) b. Say they operate with a base stock level of 6 . What is their in-stock probability? (Round your answer to 1 decimal place. Use Poisson distribution and Appendix 14A.2.) c. Say they operate with a base stock level of 7 . What is their average onorder inventory? d. Say they wish to have an in-stock probability of 0.9982 . What base stock level should they select
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