Multiple Choice
A company wants to determine its reorder point (R) . Demand is variable and the company wants to build a safety stock into R. The company wants to have a service probability coverage of 95 percent. If average daily demand is 8, lead time is 3 days, and the standard deviation of usage during lead time is 2, which of the following is the desired value of R?
A) About 17.9
B) About 19.7
C) About 24.0
D) About 27.3
E) About 31.2
Correct Answer:
Verified
Correct Answer:
Verified
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