The Demand for an Electronic Component Is Normally Distributed with an Average

question 8

Multiple Choice

The demand for an electronic component is normally distributed with an average daily demand of 500 units and a standard deviation of 50. The lead time for the component is 9 days. If the company sets a reorder point of 4,650 for this component, then its service level is approximately

• A) 50%
• B) 84%
• C) 92%
• D) 98%

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Definitions:

Total Institution

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