Daily Demand for a Product Is Normally Distributed with a Mean

question 60

Essay

Daily demand for a product is normally distributed with a mean of 160 units and a standard deviation of 12 units. The firm currently uses a reorder point system, and seeks a 75% service level during the lead time of 9 days.
a. What safety stock is appropriate for the firm?
b. What is the reorder point?

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Definitions:

Shifting Attention

The cognitive process of moving one's focus from one subject or object to another.

Cell Phone Conversations

Verbal communication between individuals through the use of mobile phones, often raising concerns about safety and etiquette in various contexts.

Attention

The mental process of concentrating on specific stimuli while ignoring others, enabling processing of relevant information.

Easy Distraction

The tendency to lose focus or attention with minimal external stimuli.