Inventory Management Class Assignment Submit your hand written answers on Canvas Q1) An electronic store uses continuous review policy to manage the inventory of its high selling monitor model. The monitor has the following characteristics. The weekly demand for the monitor is 150 units per week with standard deviation of 10. The monitor are bought from an offshore supplier with a lead time of 9 weeks at a price of 4000 AED per unit and each order costs 30000 AED. The holding cost of laptops is 30% of the value of the product. The store would like to achieve 95% cycle service level. a) What is the average demand during lead time and standard deviation of the demand during lead time? b) what is the annual demand for the monitor? c) What is the economic order quantity? EOQ? d) What would be the average time between orders (in weeks)? e) What is the required safety stock level to achieve 95% cycle service level? f) What is the reorder point for this monitor? g) What is the cycle stock level and pipeline inventory? h) What is the total cost of managing the inventory for this monitor? i) How much safety stock is needed if the store wants to use cycle service level of 90%? FORMULAE 1 year = 365 days; 1 year = 12 months; 1 month=4 weeks; 1 month=30 days; 1 week=7 days Inventory Formulas 2DS EOQ=Q* = Total Cost (TC) = S*D/Q + H*(Q/2 +Ss), SS = VH zvis 1 NORM.S.INV(0.95) = 1.65 NORM.S.INV(0.90) = 1.28 NORM.S.INV(0.92) = 1.41 NORM.S.INV(0.88) = 1.17 NORM.S.INV(0.85) = 1.04 NORM.S.INV(0.80) = 0.84