Microchip Industry The microchip shortage that is blocking the production of Cellphones will extend into 2022 You need to set up an inventory ordering system for a Copper wafer based on the following data (assume a normal distribution) Copper wafers A Copper wafer is a material essential for manufacturing microchips, which are found in all kinds of cellphones that enrich our lives Hint Select the appropriate stochastic model Average daily demand 40 copper wafers Standard deviation of demand 4 copper wafers Average lead time 7 days Standard deviation of lead time 1 day A What safety stock would you recommend if a stockout risk of 10 is considered acceptable B What safety stock would you recommend if a stockout risk of 5 is considered acceptable C What is the reorder point for a service level of 98 D A reorder point of 80 copper wafers has been set What is the service level

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Question: Microchip Industry The microchip shortage that is blocking the production of Cellphones will extend into 2022. You need to set up an inventory ordering system

Microchip Industry

The microchip shortage that is blocking the production of Cellphones will extend into 2022.

You need to set up an inventory ordering system for a Copper wafer based on the following data (assume a normal distribution).

Copper wafers: A Copper wafer is a material essential for manufacturing microchips, which are found in all kinds of cellphones that enrich our lives. [Hint: Select the appropriate stochastic model]

Average daily demand	40 copper wafers
Standard deviation of demand	4 copper wafers
Average lead time	7 days
Standard deviation of lead time	1 day

A. What safety stock would you recommend if a stockout risk of 10% is considered acceptable?

B. What safety stock would you recommend if a stockout risk of 5% is considered acceptable?

C. What is the reorder point for a service level of 98%?

D. A reorder point of 80 copper wafers has been set. What is the service level?

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