A creamery shop sells a special blend of mango and vanilla ice cream. The cost to the

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A creamery shop sells a special blend of mango and vanilla ice cream. The cost to the shop of making this ice cream is $3.00 per quart and it sells it for $4.50 per quart (in U.S. dollars). The demand for this is normally distributed with a mean of 35 quarts per day and a daily standard deviation of 4 quarts. At the end of each business day, any unsold ice cream is purchased by local restaurants for $1.50 per quart:

1. Determine the service level.

2. What is the optimal stocking level for the service level determined in (a)?

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Operations Management Managing Global Supply Chains

ISBN: 978-1506302935

1st edition

Authors: Ray R. Venkataraman, Jeffrey K. Pinto

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