Questions 5 through 13 are based on the following information: A small manufacturing company uses continuous review system for a given product. The average demand for the product is 125 units a day and the unit price is $5. It costs $25 to process each order and there is a seven-day lead-time. The holding cost is 12.5% of the price of the product per year. Company operates 200 days per year. You have been given that the appropriate EOQ is 1415. Finally, assume that both, lead time and customer demand are variable. Customer demand is given by a normal distribution of 125 units/day and standard deviation = 50 units per day. Further, lead time is normally distributed with a mean of 7 days and standard deviation of 0.5 days. Find out the safety stock needed to achieve 98% (use z=2.06) customer service level (roundup your answer). 285 O 297 302 O None of the above

Questions 5 through 13 are based on the following information: A small manufacturing company uses continuous review system for a given product. The average demand for the product is 125 units a day and the unit price is $5. It costs $25 to process each order and there is a seven-day lead-time. The holding cost is 12.5% of the price of the product per year. Company operates 200 days per year. You have been given that the appropriate EOQ is 1415. Finally, assume that both, lead time and customer demand are variable. Customer demand is given by a normal distribution of 125 units/day and standard deviation = 50 units per day. Further, lead time is normally distributed with a mean of 7 days and standard deviation of 0.5 days. Find out the safety stock needed to achieve 98% (use z=2.06) customer service level (roundup your answer). 285 O 297 302 O None of the above

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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