The Demand During the Lead-Time Is Normally Distributed with a Mean

question 53

Multiple Choice

The demand during the lead-time is normally distributed with a mean of 40 and a standard deviation of 4.If the company wishes to maintain a 90 percent service level,how much safety stock should be held?

• A)45.12
• B)41.28
• C)1.28
• D)5.12
• E)None of the above

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Definitions:

Traveler's Checks

A form of preprinted, fixed-amount cheques used by travelers to safely carry money; they can be exchanged for local currency.

One-Write System

A type of accounting system that allows for data to be entered into ledgers and journals at the same time through the use of carbon paper or a similar method.

Accounting Forms

Documents used for recording financial transactions and maintaining accounting records.

Payee

A person who receives a payment.