Business, 17.04.2020 18:32 jakebuttone
An item has a fixed cost of replenishment of $800, a value of $30, a holding costof 20% of cost, a monthly demand that is normally distributed with a mean of 500 and astandard deviation of 100, and a lead time that is normally distributed with a mean andstandard deviation of 2 weeks. A service level of 95% is desired.
Required:
a. Determine the EOQ.
b. Determine the necessary reorder point and safety stock to achieve a 90 percent service level.
Answers: 3
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An item has a fixed cost of replenishment of $800, a value of $30, a holding costof 20% of cost, a m...
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