National Auto parts uses a 4-week periodic review system to reorder parts for its inventory stock. A one week lead time is required to fill the order. Demand for one particular part during the five week replenishment period is normally distributed with a mean of 18 units and a standard deviation of 6 units. 1.At a particular periodic review, 8 units are in inventory. The parts manager places an order for 16 units. What is the probability that this part will have a stockout before an order that is placed at the next 4-week review period arrives? 2. Assume that the company is willing to tolerate a 2.5% chance of stockout associated with a replenishment decision. What is the replenishment level for the 4-week periodic review system? 3.How many parts should the manager have ordered in part (1)?

National Auto parts uses a 4-week periodic review system to reorder parts for its inventory stock. A one week lead time is required to fill the order. Demand for one particular part during the five week replenishment period is normally distributed with a mean of 18 units and a standard deviation of 6 units. 1.At a particular periodic review, 8 units are in inventory. The parts manager places an order for 16 units. What is the probability that this part will have a stockout before an order that is placed at the next 4-week review period arrives? 2. Assume that the company is willing to tolerate a 2.5% chance of stockout associated with a replenishment decision. What is the replenishment level for the 4-week periodic review system? 3.How many parts should the manager have ordered in part (1)?

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter10: Introduction To Simulation Modeling

Section10.5: Introduction To @risk

Problem 19P: In Problem 12 of the previous section, suppose that the demand for cars is normally distributed with...

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