Question
You are in charge of inventory control of a highly successful product retailed by your firm. Weekly demand for this itemvaries, with an average of
You are in charge of inventory control of a highly successful product retailed by your firm. Weekly demand for this itemvaries, with an average of 100 units and a standard deviation of 20 units. It is purchased from a wholesaler at a cost of $12.00 per unit. The supply lead time is 7 weeks. Placing an order costs $60.00, and the inventory carrying rate per year is 25 percent of theitem's cost. Your firm operates 5 days perweek, 48 weeks per year. Refer to the standard normal table
forz-values.
a. What is the optimal ordering quantity for thisitem?
nothing
units. (Enter your response rounded to the nearest wholenumber.)
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