1. The demand rate for raw material A is normally distributed with an average of 300 pints per day. The lead time is 4 days. The standard deviation of daily demand is 15 pints. What is the average demand during the 4-day lead time?

a. 900

b. 600

c. 300

d. 1200

2.

An assistant manager is reviewing the costs associated with one of the stores better-selling products. Demand is 400 units/year. The ordering cost is $25 per order and the holding cost is $0.50 per unit per year. They currently order 50 units at a time. Would you recommend that they order more than 50 units at a time, less than 50 units at a time, or keep the order equal to 50 units?

a. They should order more than 50 units at a time.

b. The should order less than 50 units

c. The should keep the order equal to 50 units.

d. Need more information to determine.