Question: Consider two products that are sourced from the same supplier and have the same lead times.The demand forecast for each product has a Normal distribution.

Consider two products that are sourced from the same supplier and have the same lead times.The demand forecast for each product has a Normal distribution. As it turns out, both products have the same mean demand. However, demand for product A has a higher standard deviation than demand for product B. Is the following statement true of false?

"For the same service level (>50%), the reorder point for product A is higher than the reorder point of product B."

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