Table $5.9$ Demand $= 140$ Units/week
Standard Deviation in Weekly Demand $= 21$

question 160

Multiple Choice

Table $5.9$
Demand $= 140$ units/week
Standard deviation in weekly demand $= 21$ units
Ordering cost $= \$ 20$ /order
Holding cost $= \$ 1$ per unit per year
Cycle-service level $= 85$ percent
Lead time $= 6$ weeks
You will need to refer to a normal table to answer the question(s) .
-Use the information in Table 5.9. Design a periodic review system with P = 4 weeks. Assume demand during lead time plus review period to be normally distributed. What target inventory will provide the desired cycle- service level of 85 percent?

• A) less than or equal to 1400 units
• B) greater than or equal to 1400 but less than or equal to 1425 units
• C) greater than 1425 but less than or equal to 1450 units
• D) greater than 1450 units

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