Question: A new logistics analyst has approached you regarding a potential problem. Her analysis indicates the cost of a back order is $60 for our Autographed

A new logistics analyst has approached you regarding a potential problem. Her analysis indicates the cost of a back order is $60 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 K to Service Level Conversion 0.00 0.03 0.01 0.02 0.04 0.07 0.08 0.05 0.06 0.5239 0.5279 0.0 0.09 0.5359 0.5753 0.5000 0.5040 0.5438 0.5080 0.5478 0.5120 0.5517 0.5160 0.5557 0.5199 0.5596 0.5319 0.5714 0.5636 0.1 0.5398 0.5675 0.6064 0.6141 0.2 0.5832 0.5793 0.6179 0.5871 0.6255 0.5948 0.6331 0.5987 0.6368 0.6736 0.6517 0.3 0.6443 0.6808 0.6026 0.6406 0.6772 0.7123 0.6217 0.6591 0.6950 0.4 0.6700 0.6554 0.6915 0.5910 0.6293 0.6664 0.7019 0.7357 0.7673 0.6628 0.6985 0.6103 0.6480 0.6844 0.7190 0.7517 0.7823 0.6879 0.7224 0.7054 0.7157 0.5 0.7088 0.7422 0.6 0.7291 0.7389 0.7324 0.7257 0.7580 0.7454 0.7764 0.7486 0.7794 0.7549 0.7852 0.7734 0.7704 0.7 0.7611 0.7642 0.8133 0.7967 0.7995 0.8 0.7881 0.8159 0.7910 0.8186 0.7939 0.8212 0.8078 0.8340 0.8106 0.8365 0.8389 0.8264 0.9 0.8238 1 1.0 0.8438 0.8461 0.8686 0.8413 0.8643 0.8485 0.8708 0.8599 0.8810 0.8621 0.8830 0.8508 0.8729 0.8023 0.8051 0.8289 0.8315 0.8531 0.8554 0.8749 0.8770 0.8944 0.8962 0.9115 0.9131 ADE A02 1.1 0.8665 0.8577 0.8790 0.8980 0.9147 0.8997 0.8888 0.8925 0.8907 0.8869 0.9015 0.9177 1.2 0.8849 0.9162 LI 0.9049 0.9032 0.9082 0.9066 0.9099 ALORS AR AM ARILOR A02 0.9 0.8159 0.8186 0.8212 0.8238 0.8264 0.8315 0.8340 0.8365 0.8389 0.8289 0.8531 1.0 0.8413 0.8438 0.8461 0.8485 0.850B 0.8554 0.8577 0.8599 0.8621 1.1 0.8643 0.8665 0.8686 0.8708 0.8729 0.8749 0.8770 0.8790 0.8810 0.8830 1.2 0.8849 0.8869 0.8888 0.8907 0.8925 0.8944 0.8962 0.8980 0.8997 0.9015 1.3 0.9032 0.9049 0.9066 0.9082 0.9099 0.9115 0.9131 0.9147 0.9162 0.9177 1.4 0.9192 0.9207 0.9222 0.9292 0.9319 0.9236 0.9370 0.9251 0.9382 0.9265 0.9394 0.9278 0.9406 0.9306 0.9429 1.5 0.9357 0.9418 0.9441 0.9332 0.9452 0.9554 0.9345 0.9463 1.6 0.9474 0.9484 0.9495 0.9505 0.9515 0.9525 0.9545 0.9535 0.9625 1.7 0.9564 0.9573 0.9582 0.9591 0.9599 0.9608 0.9616 0.9633 1.8 0.9641 0.9649 0.9656 0.9664 0.9671 0.9693 0.9678 0.9744 0.9686 0.9750 0.9699 0.9761 0.9706 0.9767 1.9 0.9713 0.9719 0.9726 0.9732 0.9738 0.9756 k N[k] Conversion K .00 .01 .02 .03 .04 .05 .06 .07 .08 .09 0.0 .3989 .3940 .3890 .3841 .3793 3744 3697 3649 3602 0.1 .3509 .3464 .3373 3328 3284 .3240 3197 .3418 .2986 3154 2745 .3556 .3111 .2706 0.2 .3069 .3027 2944 .2904 .2863 2824 2784 0.3 .2668 .2630 2592 2555 2518 .2481 2445 2409 2374 .2339 0.4 2304 .2270 .2236 2203 2137 2104 2072 .2040 .2009 2169 .1857 0.5 .1978 .1947 .1917 .1887 .1828 .1799 .1771 .1742 1714 0.6 -1687 .1659 .1633 .1606 .1580 .1554 .1528 .1503 .1478 .1453 0.7 .1429 .1405 .1358 .1334 1312 .1289 .1267 .1223 .1381 .1160 0.8 .1245 .1042 .1202 .1181 .1140 .1120 -1100 .1061 0.9 .1004 1023 .08491 .09860 209680 .09503 .09328 .09156 .08654 1.0 .08332 .08174 .08019 .07866 .07568 .07138 .06999 1.1 .06862 .06727 .06595 .06465 .06210 .1080 .08986 .07422 .06086 .04954 .04002 .03208 .05844 .05726 1.2 ,05610 .08819 .07279 .05964 .04851 .03916 .03208 .05384 .07716 ,06336 .05165 .04179 .03356 .05274 .05059 .05496 .04457 ,04750 .04650 1.3 .04553 .04363 .04270 .04090 .03831 .03748 1.4 .03667 .03587 .03508 ,03431 .03281 .03137 .02998 1.5 .02931 .02865 .02800 ,02736 .02674 .02612 .02552 .02494 .02436 ,02380 0.5 .1978 .1947 .1917 .1887 .1857 .1828 .1799 .1771 .1742 0.6 .1687 .1659 . 1633 .1606 .1580 .1554 .1528 .1503 .1478 .1429 .1405 .1381 .1358 .1334 .1312 .1289 .1267 .1245 0.7 0.8 .1202 .1181 .1160 .1140 .1120 .1100 .1080 .1061 .1042 0.9 .1004 .09680 .09503 .09328 .09156 .08986 .08819 .08654 .09860 .08174 1.0 .08019 .07866 .07716 .07568 .07422 .07279 .07138 .08332 .06862 .06727 .06595 .06465 .06210 .06086 .05964 1.1 1.2 .05844 .05610 .05496 .05384 .05274 .06336 .05165 .04179 .04954 .04851 .04750 .05059 .04090 1.3 .04553 .04363 .04002 .03916 .03831 04457 .03587 1.4 .03667 .03508 .04270 .03431 .02736 .03356 .03281 .03208 .03208 .03137 1.5 .02931 .02865 .02800 .02674 .02612 .02552 .02494 .02436 20 30 0 31 0 33 35

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