A Manager Is Reordering Lubricant When the Amount On-Hand Reaches

question 45

Essay

A manager is reordering lubricant when the amount on-hand reaches 422 pounds.Average daily usage is 45 pounds,which is normally distributed and has standard deviation of three pounds per day.Lead time is nine days.What is the risk of a stock-out?

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Definitions:

Net Transfers

Financial or in-kind transactions without a direct quid pro quo, often seen in government budgets or international aid.

Net Investment Income

The profit gained from investment activities after subtracting all related expenses, such as fees and taxes.

Assets Abroad

Financial holdings or investments located in foreign countries, outside of an investor's home country.

Current Account Deficit

A measurement of a country’s trade where the value of the goods and services it imports exceeds the value of the products it exports.