cenario $12\mathrm{.}13$

Demand $=100,000$ units$/$year

Number of days per year $=250$ weeks

Standard deviation of weekly demand $=50$ units

Average lead time $=5$ days

Standard deviation of lead time: $2$ days

Cycle$-$service level $=99\%$

A continuous review system is used to control inventory.

A normal distribution table follows.

Use the information in Scenario $12\mathrm{.}13.$ If the firm decides to reduce its cycle$-$service level to $95\%,$ what is the new reorder point if all other parameters remain the same for this product?

Greater than $4,500$ units

Greater than $3,500$ units but less than or equal to $4,500$ units

Greater than $2,500$ units but less than or equal to $3,500$ units

Greater than $1,500$ units but less than or equal to $2,500$ units

Greater than $0$ but less than or equal to $1,500$ units