If Daily Demand Is Constant at 10 Units Per Day

question 93

Multiple Choice

If daily demand is constant at 10 units per day, and lead time averages 12 days with a standard deviation of 3 days, 95 percent service requires a safety stock of approximately

• A) 28 units
• B) 30 units
• C) 49 units
• D) 59 units
• E) 114 units

---

Definitions:

Combined Probability

Combined probability refers to the likelihood of two or more independent events happening at the same time, calculated by multiplying the probabilities of each event.

Calculated Statistic

A calculated statistic is a numerical summary derived from a sample, used for analyzing or making inferences about a population.

Unshaded Area

Represents the portion of a graph or figure that is not marked or covered by a darker color or pattern.

Critical Value

A point on the scale of a test statistic that represents the threshold of significance, beyond which a null hypothesis is rejected.