Question: A new logistics analyst has approached you regarding a potential problem. Her analysis indicates the cost of a back order is $30 for our Autographed

A new logistics analyst has approached you regarding a potential problem. Her analysis indicates the cost of a back order is $30 for our Autographed Footballs, but she is not sure what the appropriate safety stock should be. Given this back order cost, what would you suggest as the appropriate level of safety stock?

Football cost $200
Annual Demand 5000 units
Cost per Order $250
Cost to hold the item per year 40%
Economic order quantity 177
Lead Time 2 weeks
Standard Deviation of Forecasted Demand During Lead Time 20

choose the correct answer:

20

27

30

33

35

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!