The COO has been reviewing the inventory levels at his West Coast DC in Los Angeles which supplies the Southern California area. He currently maintains a service level of 97% (z = 1.89), and his replenishment lead time from the supplier is 4 weeks. His current average inventory position is 571 units. Currently, his demand and EOQ position is as follows:

Product: Los Angeles

Average Weekly Demand during Lead Time: 300

Standard Deviation of Demand: 45

Coefficient of Variation: 0.15

Economic Order Quantity: 800

The EOQ for Los Angeles is based on the different Order Costs and holding costs for each facility.

The COO has reviewed his service levels at the DC in Los Angeles and felt that he would be comfortable lowering his service levels of Product AA to 95% (z of 1.65). What would be the new average inventory levels he would need to maintain? [round up to the nearest highest number]

a) 403

b)452

c)485

d)549

e)636

(need to formula and need to solve step by step)