(26 pts) Motorola obtains cell phones from its contract manufacturer located in China to serve the U. S. market. The U. S. market is served from a warehouse located in Memphis, Tennessee. Daily demand at the Memphis warehouse is normally distributed, with a mean of 5,000 and a standard deviation of 4,000. The warehouse aims for a CSL of 99 percent. The company is debating whether to use sea or air transportation from China. Sea transportation results in a lead time of 36 days and costs $0.50 per phone. Air transportation results in a lead time of 4 days and costs $1.50 per phone. Each phone costs $100, and Motorola uses an annual inventory holding ratio of 20 percent. a) What reorder point and safety inventory should the warehouse aim for when using sea or air transportation

when sea transportation is used:

safety stock = Z-score x √lead time x standard deviation of demand

safety stock = 2.58 x √36 x 4,000 units = 61,920 units

reorder point = lead time demand + safety stock

reorder point = 180,000 units + 61,920 units = 241,920 units

when air transportation is used:

safety stock = Z-score x √lead time x standard deviation of demand

safety stock = 2.58 x √4 x 4,000 units = 20,640 units

reorder point = lead time demand + safety stock

reorder point = 20,000 units + 20,640 units = 40,640 units

answer: b) the us is the leading importer but not the leading exporter.

extra info:

the u.s is the largest importer but it is not the largest exporter as china sits on the top of the table when it comes to leading exporters.

but u.s is not far from first,

they rank in 2nd globally as the worlds largest exporter.

happy to

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the answer is either c or b, i cant be to sure tho.