Question: Prob . 3 . Solve the following problems with related to the safety stock. ( 3 0 points ) ( 1 ) Now we have

Prob.3. Solve the following problems with related to the safety stock. (30 points)
(1) Now we have the stock of 88ton. The demand follows the normal distribution and the average demand per
month is ton/month] and the standard deviation is ton/month]. Find the probability that the amount of
stock becomes below zero within four months.
(2) There are two regions (a) and (b), and the warehouse A and B cover retailers in each reason respectively.
Products are carried to the warehouses once a month. The monthly demand of region (a) follows the normal
distribution N(10,22) and that of (b) follows N(10,32).N(mean, variance) The demand of region (a) and (b)
are not independent and the correlation coefficient between them is 0.50. We will make a new
warehouse that covers both region A and B. How much should the new warehouse have safety
stock for the monthly demand? They expect that the risk of stockout is less than 5.0%.
(3) Discuss the advantage of centralized distribution system from the view points of cost and service level. (10)
 Prob.3. Solve the following problems with related to the safety stock.

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