Chapter $9$: A pharmacist is trying to determine the inventory order and stock levels for a particular drug. The following information is available about the drug.

Weekly Demand $($d$)65$ tablets$/$week

Working weeks per year $52$ weeks

Unit holding cost per year $($H$)$ $$8$

Order cost $($S$)$ $$80/$order

Standard deviation of weekly demand $($d$)18$ tablets

Lead time $($L$)3$ weeks

Desired cycle service level $95\%$

a$)$ If the pharmacist uses the continuous review $($Q$)$ system to control the inventory of the drug, what would be the order quantity and reorder point?

b$)$ If the pharmacist uses the periodic review $($P$)$ system to control the inventory of the drug, what would be the review interval and target inventory level? $($Hint: Use the EOQ model to derive the review interval P$)$