Question: 1 . An optometrist orders eyeglass frames at a cost of $ 4 0 per frame and sells each frame for $ 7 0 .

1. An optometrist orders eyeglass frames at a cost of $40 per frame and sells each frame for $70. Annual holding cost is 25% of the optometrists cost of purchasing a frame. Each time frames are ordered, a cost of $200 is incurred. Because of lost goodwill, a cost of $50 is incurred each time a customer wants a frame that is not in stock. Frames are delivered two weeks after an order is placed. Annual demand for frames is normally distributed with mean of 1040, and standard deviation of 20.42.
a Assuming all shortages are backlogged, determine the order quantity, safety stock and reorder point.

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