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ISS 210 Lecture Notes - Lecture 4: Standard Deviation

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salmonwombat984
25 Sep 2018
School
MSU
Department
Integrative Studies in Social, Behavioral and Economic Sciences
Course
ISS 210
Professor
Rautman

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Document Summary

Scm 373: lindner congress bookstore sells a unique calculator to college students. The demand for this calculator can be described by a normal distribution with an average daily demand of. 25 units and a standard deviation of 4 units per day. The order lead time for this calculator is very stable at 10 days. The demand for this calculator stable daily demand of 25. Compute the standard deviation of demand during the lead time period, and determine the safety stock and statistical reorder point that result in a 95 percent service level: lindner congress bookstore sells a unique calculator to college students. This calculator can be described by a normal distribution with an average daily demand of 25 units and a standard deviation of 4 units per day. The order lead time for this calculator can be described by a normal distribution with a mean of 10 days and standard deviation of 2 days.

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Related Questions

Problem 10-31 (Algorithmic)

A product with an annual demand of 1000 units has Co = $24.50 and Ch = $5. The demand exhibits some variability such that the lead-time demand follows a normal probability distribution with µ = 24 and σ = 4.

Note: Use Appendix B to identify the areas for the standard normal distribution.

What is the recommended order quantity? Round your answer to the nearest whole number.

Q* =

What are the reorder point and safety stock if the firm desires at most a 7% probability of stock-out on any given order cycle? If required, round your answers to the nearest whole number.

Record point =

Safety stock =

If a manager sets the reorder point at 29, what is the probability of a stock-out on any given order cycle? If required, round your answer to four decimal places.

P(Stockout/cycle) =

How many times would you expect a stock-out during the year if this reorder point were used? Round your answer to the nearest whole number.

Number of Orders =