(Answered) Question a local manufacturer uses a part in production

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Question: A local manufacturer uses a part in production that has a normally distributed demand during the reorder period. The mean (average) demand during the reorder period is 120 with a standard deviation of 10. The plant manager wants the probability of a stockout during the reorder period to be 2% of the time.

a) What reorder point should be used?

b) How much safety stock should be maintained?

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