Question: A hardware store is interested in your help in ordering a certain item, the details for which are provided below. Annual Demand is normally distributed

A hardware store is interested in your help in ordering a certain item, the details for which are provided below.

Annual Demand is normally distributed with a mean of 144,000 and a standard deviation of 14,000

The store orders the product 9th day of every month The lead time to order is month

. Cost of placing the order is $120

The purchase price of the item is $22.00, and the holding rate is 25% per year

The firm requires a 97% service probability.

Right now, it is 9:00 am, Friday, July 9, 2021, the order day. You need to determine the order size. The store has 900 units in inventory, and 300 units in back order that is shipping out this afternoon. What is the size of the order?

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