Question: Determining Optimum Service Levels ( Cont ' d ) Sales response rate is 0 . 1 % change in revenue for a 1 % change
Determining Optimum Service Levels Contd
Sales response rate is change in revenue for a change in the service level fill rate Trading margin is $ per item, inventory carrying cost is per year, annual sales through the warehouse is items. Cost of each item is $ demand standard deviation is items for a week, and the lead time is weeks. Given the above data for a particular product calculate
a
b Optimal CSL
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