Question: In a continuous review inventory system, the lead time for doorknobs is 5 weeks. The standard deviation of demand during the lead time open parentheses

In a continuous review inventory system, the lead time for doorknobs is 5 weeks. The standard deviation of demand during the lead time open parentheses sigma subscript d L T end subscript close parentheses is 85 units. The desired cycle-service level is 99 percent. The supplier of doorknobs streamlined its operations and now quotes a one-week lead time. How much can safety stock be reduced without reducing the 99 percent cycle-service level? (Use Z = 2.33; round to the nearest unit)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!