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Suppose there are two local bicycle stores selling the same kind of bicycle. Store 1 has weekly demand of 40 with a standard deviation of
Suppose there are two local bicycle stores selling the same kind of bicycle. Store 1 has weekly demand of 40 with a standard deviation of 10. Store 2 has weekly demand of 60 with a standard deviation of 20. The supplier has a constant lead time of 4 weeks. Both stores operate independently, reviewing inventory and ordering every 2 weeks. Each store wants a 95% chance of not stocking out. What is the total safety stock being carried by the two firms? (Please use the Gamma distribution to model demand during the exposure period.)
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