Management Has Carefully Measured the Standard Deviation of the Demand

question 4

Multiple Choice

Management has carefully measured the standard deviation of the demand of a product and plans to use this to calculate the level of safety stock. If they keep one Standard Deviation of safety stock then
The expected service level should be approximately:

• A) 15%
• B) 35%
• C) 85%
• D) 90%
• E) 100%

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Definitions:

Vision

A forward-looking statement or concept that outlines what an organization aspires to achieve in the future, guiding its strategic decisions and direction.

Product's Price

The monetary value assigned to a product by a company, reflecting costs, market demand, and competitive pricing, which consumers are expected to pay to acquire it.

Value

Reflects the relationship of benefits to costs, or what the consumer gets for what he or she gives.

Quality

A measure of excellence or a state of being free from defects, deficiencies, and significant variations, brought about by strict and consistent adherence to measurable and verifiable standards to achieve uniformity of output that satisfies specific customer or user requirements.