Question: Given the following information: Expected demand during a lead time = 600 kg Standard deviation of demand during a lead time= 52 kg Acceptable stock-out

Given the following information:
Expected demand during a lead time = 600 kg
Standard deviation of demand during a lead time= 52 kg
Acceptable stock-out risk during a lead time = 4 percent
a. What amount of safety stock is appropriate?
b). At what level of inventory should this item be reordered?

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