Average Daily Demand for a Product Is Normally Distributed with a Mean

question 35

Essay

Average daily demand for a product is normally distributed with a mean of 5 units and a standard deviation of 1 unit.Lead time is fixed at four days.
(a)What is the reorder point if there is no safety stock?
(b)What is the reorder point if the service level is 80 percent?
(c)How much more safety stock is required if the service level is raised from 80 percent to 90 percent?

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Definitions:

Bright Side

Often refers to the optimistic perspective of a situation, focusing on its positive aspects.

Liquidated Debt

A debt whose amount has been determined and acknowledged by both the debtor and the creditor.

Accord And Satisfaction

A legal contract wherein a dispute is settled by the parties agreeing and performing on a new obligation which differs from the original agreement.

Unliquidated Debt

Debt for which the specific value has not been determined, often because the exact amount depends on future events or conditions.