Question: Problem Statement: Continuous Review Inventory System A retailer keeps an inventory for its bestselling SKU. The weekly demand rate for the SKU is horizontal and

Problem Statement: Continuous Review InventoryProblem Statement: Continuous Review Inventory

Problem Statement: Continuous Review Inventory System A retailer keeps an inventory for its bestselling SKU. The weekly demand rate for the SKU is horizontal and random. The mean value of demand rate is 200 units/week, and its standard deviation is 25 units/week. The order's shipment lead-time is 2 weeks. We assume there are 50 weeks in a year. The ordering cost is $500/order. The inventory holding cost is $15 per unit per year. Suppose that the manager of the retailer uses the Continuous Review (Q) system to manage the inventory. The retailer aims at the cycle service level of 95%. Please answer the following questions. The Normal Distribution table is available at Normal distribution table.pdf. Question 18 3 pts The manager of the retailer requires the cycle service level of 95%. To meet this requirement, the manager must set the safety stock to be: ______ units. The Normal Distribution table is available at Normal distribution table.pdfa. (Please round your answer to whole number.) 2 pts Question 19 Continue with your answer to the preceding question. To meet the cycle service level requirement, the manager must set the Reorder Point (ROP) to be units. (Please round your answer to whole number.) 3 pts Question 20 Suppose that the manager accidentally set Reorder Point (ROP) to be 440. The probability of no stockout during the shipment lead-time is ____ %. (Please round your answer to keep one decimal place after the dot.)

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