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The operations manager at J. Hansen Enterprises, Inc. has a historical sample of demand during the lead-time that is normally distributed. She found that the

The operations manager at J. Hansen Enterprises, Inc. has a historical sample of demand during the lead-time that is normally distributed. She found that the average daily demand is 70 units and the standard deviation of daily demand is 20 units. Lead time is a constant of 3 days. Answer the following questions based on the above data:

a) What is the safety stock at a cycle service level of 95%?

b) What is the reorder point (ROP) to meet a 95% cycle service level?

c) If the reorder point is 250, what is the cycle service level (CSL)?

d) What is the safety stock at a cycle service level of 90% if the manager utilizes a periodic review model with T = 4 days?

e) What is the safety stock if the lead-time has a mean of 3 days and a standard deviation of 1 day? Use a CSL of 0.95

f) Assume that there is no demand uncertainty, but only supply uncertainty as noted in # 5 above exists. Daily demand is 70 units. What is the safety stock at CSL of 0.95.

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