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The annual demand for a product is 1 4 , 2 0 0 units. The weekly demand is 2 7 3 units with a standard

The annual demand for a product is 14,200 units. The weekly demand is 273 units with a standard deviation of 95 units. The cost to place an order is $32.00, and the time from ordering to receipt is four weeks. The annual inventory carrying cost is $0.10 per unit.
Find the reorder point necessary to provide a 95 percent service probability.
Note: Use Excel's NORM.S.INV() function to find the z value. Round z value to 2 decimal places.
Suppose the production manager is asked to reduce the safety stock of this item by 45 percent. If she does so, what will the new service probability be?

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