A company currently has 200 units of a product on hand that it orders every two weeks when the salesperson visits the premises. Demand for the product averages 20 units per day with a standard deviation of 5 units. Lead time for the product to arrive is seven days. Management has a goal of a 95 percent probability of not stocking out for this product. The salesperson is due to come in late this afternoon when 180 units are left in stock ( assuming that 20 are sold today). How many units should be ordered?

A company currently has 200 units of a product on hand that it orders every two weeks when the salesperson visits the premises. Demand for the product averages 20 units per day with a standard deviation of 5 units. Lead time for the product to arrive is seven days. Management has a goal of a 95 percent probability of not stocking out for this product. The salesperson is due to come in late this afternoon when 180 units are left in stock ( assuming that 20 are sold today). How many units should be ordered?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 35P

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