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Business, 17.04.2021 17:10 nyha90

Annual demand for the new Nintendo Zelda game at Game Stop on Weldon road is 2,000 units; with a standard deviation of demand at 7 units on a weekly basis. To have an order processed and delivered is around $80 from the warehouse in Kansas, and the time from ordering to receipt is 2 weeks. The game costs Game Stop $25 per unit, and they predict that their holding costs are around 20%. A. Find the reorder point necessary to provide a 90 percent service probability.
B. Suppose the production manager is asked to reduce the safety stock of this item by 55%. If she does so, what will the new service probability be?

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