Question: In a continuous review inventory system, the lead time for door knobs is 5 weeks. The standard deviation of demand during the lead time is
In a continuous review inventory system, the lead time for door knobs is weeks. The standard deviation of demand during the lead time is units. The desired cycleservice level is percent. The supplier of door knobs streamlined its operations and now quotes a week lead time. How much can safety stock be reduced without reducing the percent cycleservice level?
In a twobin inventory system, the demand for inch lag bolts during the week lead time is normally distributed with an average of units per week. The standard deviation of weekly demand is units.
a What is the probability of demand exceeding the reorder point when the normal level in the second bin is set at units?
b What is the probability of demand exceeding the units in the second bin if it takes weeks to receive a replenishment order?
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