Question: To answer this question you will need to use the table below ... Suppose we have decided that an acceptable risk of a stockout for
To answer this question you will need to use the table below ...
Suppose we have decided that an acceptable risk of a stockout for Inventory item Delta is 3.59%. Demand for Delta is normally distributed, with a mean equal to 700 units and a standard deviation equal to 40 units. Until very recently, lead time for Delta was equal to 6 days, but our vendor has now told us that lead time for Delta will be increasing by 2 days. How much more safety stock will we need to carry? (Round to 2 decimal places)
| Z | G(Z) | Z | G(Z) | Z | G(Z) | Z | G(Z) |
| 0.25 | 0.5987 | 0.75 | 0.7734 | 1.25 | 0.8944 | 1.75 | 0.9599 |
| 0.30 | 0.6179 | 0.80 | 0.7881 | 1.30 | 0.9032 | 1.80 | 0.9641 |
| 0.35 | 0.6368 | 0.85 | 0.8023 | 1.35 | 0.9115 | 1.85 | 0.9678 |
| 0.40 | 0.6554 | 0.90 | 0.8159 | 1.40 | 0.9192 | 1.90 | 0.9713 |
| 0.45 | 0.6736 | 0.95 | 0.8289 | 1.45 | 0.9265 | 1.95 | 0.9744 |
| 0.50 | 0.6915 | 1.00 | 0.8413 | 1.50 | 0.9332 | 2.00 | 0.9772 |
| 0.55 | 0.7088 | 1.05 | 0.8531 | 1.55 | 0.9394 | 2.05 | 0.9798 |
| 0.60 | 0.7257 | 1.10 | 0.8643 | 1.60 | 0.9452 | 2.10 | 0.9821 |
| 0.65 | 0.7422 | 1.15 | 0.8749 | 1.65 | 0.9505 | 2.15 | 0.9842 |
| 0.70 | 0.7580 | 1.20 | 0.8849 | 1.70 | 0.9554 | 2.20 | 0.9861 |
Correct Answer
27.28
I need steps to get to the answer
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
