Question: Petromax Enterprises uses a continuous review inventory control system for one of its SKUs. The following information is available on the item. The firm operates

Petromax Enterprises uses a continuous review inventory control system for one of its SKUs. The following information is available on the item. The firm operates 48 weeks in a year. Refer to the standard normal table..for z-values.

Demand =91,000 units/year

Ordering cost =$60/order

Holding cost =$3.50/unit/year

Average lead time =9 weeks

Standard deviation of weekly demand =175 units

Part 2

a. The economic order quantity for this item is ___units. (Enter your response rounded to the nearest whole number.)

Part 3

b. If Petromax wants to provide a 96% service level, the safety stock is _________units (enter your response rounded to the nearest whole number) and the reorder point is _________units (enter your response rounded to the nearest whole number).

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