Question: Problem 2 . A Q System Judy uses a continuous review system ( Q system ) to manage inventory for Ipad at Bestbuy store. Judy

Problem 2. A Q System
Judy uses a continuous review system (Q system) to manage inventory for Ipad at Bestbuy store. Judy collected the following numbers based on her observation:
Demand =10 units/wk (assume 52 weeks per year)
Ordering and setup cost (S)= $45/order
Holding cost (H)= $12/unit/year
Lead time (L)=3 weeks
Standard deviation in weekly demand =8 units
Cycle-service level =70%
a. What is the EOQ for Ipad?
b. What is the desired safety stock?
c. What is the desired reorder point R?
d. Suppose that Bestbuys current policy is Q =80 and R =150. How much will Bestbuy save in total cost if your EOQ and R-values are implemented?

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