Question: Problem 20-30 (Algo) It is your responsibility, as the new head of the automotive section of Nichols Department Store, to ensure that reorder quantities for

Problem 20-30 (Algo) It is your responsibility,
Problem 20-30 (Algo) It is your responsibility, as the new head of the automotive section of Nichols Department Store, to ensure that reorder quantities for the various items have been correctly established. You decide to test one item and choose Michelin tires, XW size 185 x 14 BSW. A perpetual Inventory system has been used, so you examine this, as well as other records, and come up with the following data: Cont per tire Holding cost Demand Ordering cost Standard deviation of daily demand Delivery lead time 5 55 each 25 percent of tire cost per year 1,200 per year $ 40 per order 4 tires 5 daya Because customers generally do not wait for tires but go elsewhere, you decide on a service probability of 90 percent. Assume the demand occurs 365 days per year. a. Determine the order quantity. (Round your answer to the nearest whole number.) tires

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