Explain how much safety stock provides a 95 service level, Ask an Expert

Management Studies

Q. Thomas' Bike Shop stocks a high volume item that has a normally distributed demand during the reorder period. The average daily demand is 70 units, the lead time is 4 days and the standard deviation of demand during the reorder period is 15.

a. Explain how much safety stock provides a 95% service level to Thomas?

b. Illustrate what should the reorder point be?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M9309512

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