Management has stated that it will tolerate one stockout per year. The forecast of annual demand for a particular SKU is 100,000 units, and it is ordered in quantities of 10,000 units. The lead time is 2 weeks constant. Forecasts are made weekly and the sales history for the past 10 weeks is shown in the table below.

A) What is the Sigma (standard deviation of demand) for the forecast interval?

B) Management targets a 90% service level. what is the Sigma (standard deviation of demand) for the lead time interval? what is the amount of safety stock the company should carry to meet the service level target?

Week	Actual Demand	Deviation	Squared Deviation
1	2100	100	10,000
2	1700	-300	90,000
3	2600	600	360,000
4	1400	-600	360,000
5	1800	-200	40,000
6	2300	300	90,000
7	2200	200	40,000
8	1600	-400	160,000
9	2100	100	10,000
10	2200	200	40,000
Sum			1,200,000