Question: Average annual demand for SKU # 4 8 2 ?is 1 1 2 , 0 0 0 ?units, and the standard deviation of annual demand

Average annual demand for SKU # 4 8 2 ?is 1 1 2 , 0 0 0 ?units, and the standard deviation of annual demand is 2 6 , 0 0 0 ?units. The average lead time is 3 ?months ( i . e . 0 . 2 5 ?years ) ?with a standard deviation of 0 . 1 ?years. Thus, the std . ?deviation of lead time demand is about 1 7 , 1 5 9 ?units. The purchase cost of one unit of SKU # 4 8 2 ?is $ 3 8 , ?and the annual inventory carrying cost factor is 2 5 % . ?The cost of placing an order is $ 4 4 0 ?per order. The Executive Committee has decided that stock - outs should be avoided in 9 3 % ?of all or What is the average total inventory level of SKU # 4 8 2 ? ?Select the closest value.

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