If It Takes a Supplier 4 Days to Deliver an Order

question 9

Multiple Choice

If it takes a supplier 4 days to deliver an order once it has been placed and the standard deviation of daily demand is 10, which of the following is the standard deviation of usage during lead time?

• A) 10
• B) 20
• C) 40
• D) 100
• E) 400

---

Definitions:

Assumption

A basic condition or premise considered to be true without verification or proof, often used as a starting point for further analysis.

Power Curve

A graph of the probability of rejecting H0 for all possible values of the population parameter not satisfying the null hypothesis. The power curve provides the probability of correctly rejecting the null hypothesis.

Null Hypothesis

A hypothesis used in statistics that suggests there is no significant effect or difference, serving as a default position that there is no association between two measured phenomena.

Probability

A measure of the likelihood or chance that a particular event will occur, expressed on a scale from 0 to 1.