A large hospital uses a certain intravenous solution that it maintains in inven$-$

tory. Pertinent data about this item are as follows:

a$365$ days per year

${?}^b$ Normally distributed

'During the lead time or during the order interval plus lead

time, depending on the inventory control design

a$.$ Design a reorder point system of control for this item.

b$.$ Design a periodic review system of control for this item.

c$.$ Do you think the in$-$stock probability is correctly specified to minimize costs?

Appraise with reference to the reorder point system design.