You $$need $$to $$choose $$one $$sultable $$supplier $$among $$two $$avaliable $$suppliers $$for $$a $$product $$

$$

$.$

$$Your $$Weekly $$demand $$for $$

$$

$$at $$is $$normally $$distributed $$with $$a $$mean $$of $$

$1$

$0$

$0$

$$and $$a $$standard $$deviation $$of $$

$5$

$0$

$.$

$$You $$have $$historically $$purchased $$a $$

$1$

$0$

$0$

$$per $$month $$from $$a $$local $$supplier $$who $$charges $$Ris $$

$5$

$0$

$$per $$unit$.$You $$have $$identified $$another $$potential $$source $$willing $$to $$supply $$the $$

$$

$$at $$Rs $$

$4$

$0$

$$per $$unit$.$Before $$making $$decision$,$you $$evaluate $$the $$cost $$associated $$with $$the $$two $$suppliers$.$You $$are $$currently $$using $$continuous $$review $$policy $$for $$managing $$inventory $$and $$aims $$for $$a $$cycle $$service $$level $$of $$

$9$

$5$

$$percent$.$Which $$supplier $$should $$you $$go $$with $$if $$you $$have $$a $$holding $$cost $$of $$

$2$

$0$

$$percent$?$

$[$

Note $$FS

$-$

$\text{'}$

$($

$0$

$.$

$9$

$5$

$)$

$=$

$1$

$.$

$6$

$4$

$]$

$[$

$0$

$]$

$\backslash$

table

$[$

$[$

$,$

Local $$Supplier$,$Potential $$Supplier

$]$

$,$

$[$

Average $$lead $$time$,$

$1$

$$week$,$

$2$

$$weeks

$]$

$,$

$[$

SD $$in $$Iead $$time$,$

$1$

$$week$,$

$1$

$$week

$]$

$,$

$[$

Minimum $$batch $$size$,$

$3$

$0$

$0$

$,$

$5$

$0$

$0$

$]$

$]$