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# 2. A grocery store sells 100 bottles of coke a week. Annual holding cost per bottle is $1. Ordering cost is $20 per order.

## 2. A grocery store sells 100 bottles of coke a week. Annual holding cost per bottle is $1. Ordering cost is $20 per order. Assume 52 weeks per year. (Round your answers to 2 decimal places.) a. (5 pts) How many bottles of coke should the store order for each order? b. (3 pts) How many times per year should the store place an order? c. (2 pts) How many weeks will elapse between two consecutive orders? d. (3 pts) Calculate the total annual cost of placing orders and holding inventory. e. (7 pts) It takes 3 weeks to receive the bottles of coke after placing an order. Assume that the weekly demand is normally distributed with mean 100 and standard deviation 20. Calculate the reorder point to achieve the service level of 90% during the lead time. f. (5 pts) The demand distribution is the same as in part e. Suppose that the lead time is 4 weeks. If the store wishes to carry no safety stock, what should the reorder point be?

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