Question: Question 6 (1 point) It is estimated that the weekly demand for a popular product at Joe's Scuba Diving shop is 86 units on average,

Question 6 (1 point) It is estimated that the

Question 6 (1 point) It is estimated that the weekly demand for a popular product at Joe's Scuba Diving shop is 86 units on average, and it (i.e., the weekly demand) has a standard deviation of 32 units. The shop is open 52 weeks a year. The shop places a replenishment order whenever the inventory reduces to a certain re-order point. The cost to place an order is $30 per order, with a order lead-time of 3 weeks. The annual inventory holding cost is $15 per unit. Suppose that the optimal order quantity is used and a service level of 95% is maintained by the shop. What is the total annual inventory holding cost? Note: Only round your final answer to the nearest integer Do not include the unit of measurement in your answer. For instance, if the answer is 15 units only enter 15. Your

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!