Question: 1. 5.6 Inasingle-product inventory system a replenishment order will be placed as soon as the inventory on hand drops to the level s. You want

1. 5.6 Inasingle-product inventory system a replenishment order will be placed as soon as the inventory on hand drops to the level s. You want to choose the reorder point s such that the probability of a stockout during the replenishment lead time is no more than 5%. Verify that s should be taken equal to μ + 1.645σ when the total demand during the replenishment lead time is N(μ,σ2) distributed.

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