Question 4 A butcher shop sells premium meats directly to customers. The butcher shop buys lamb from an Australian supplier for $6.7 per pound and sells the lamb at $13.1 per pound. The store promises fresh lamb and so will sell the remaining unsold lamb at the end of every day in bulk for $3.1 per pound to a local supermarkets. The demand for lamb at this store is normally distributed with an average of 53 pounds a a standard deviation of 4.2 pounds. Question Calculate the shortage cost. Points 4 Answer dollars Question Calculate the excess cost. Points 4 Answer dollars Question Calculate the optimal service. Points 3 Answer % Question Find the optimal amount of lamb this butcher should order. Points 3 pounds Answer Question What is the stockout risk based on the optimal service level? Points 3 Answer % Question 5 Demand for hand sanitizer at a local pharmacy can be approximated by a normal distribution with a mean of 17 liters per day and a standard deviation of 2.9 liters per day. The new manager desires a service level of 90%. Lead time is 4 days. Question What value of z is appropriate for this situation? Points 3 Answer Question How much safety stock should be held to achieve the required service level? Points 3 Answer liters Question What is the Reorder Point (ROP) that achieves the required service level? Points 6 Answer liters Question Calculate the stockout risk. Points 6 Answer % Question Calculate the expected lead time demand. (expected demand during lead time) Points 6 Answer liters Question 4 A butcher shop sells premium meats directly to customers. The butcher shop buys lamb from an Australian supplier for $6.7 per pound and sells the lamb at $13.1 per pound. The store promises fresh lamb and so will sell the remaining unsold lamb at the end of every day in bulk for $3.1 per pound to a local supermarkets. The demand for lamb at this store is normally distributed with an average of 53 pounds a a standard deviation of 4.2 pounds. Question Calculate the shortage cost. Points 4 Answer dollars Question Calculate the excess cost. Points 4 Answer dollars Question Calculate the optimal service. Points 3 Answer % Question Find the optimal amount of lamb this butcher should order. Points 3 pounds Answer Question What is the stockout risk based on the optimal service level? Points 3 Answer % Question 5 Demand for hand sanitizer at a local pharmacy can be approximated by a normal distribution with a mean of 17 liters per day and a standard deviation of 2.9 liters per day. The new manager desires a service level of 90%. Lead time is 4 days. Question What value of z is appropriate for this situation? Points 3 Answer Question How much safety stock should be held to achieve the required service level? Points 3 Answer liters Question What is the Reorder Point (ROP) that achieves the required service level? Points 6 Answer liters Question Calculate the stockout risk. Points 6 Answer % Question Calculate the expected lead time demand. (expected demand during lead time) Points 6 Answer liters