Identify the ordering policy for the item

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Reference no: EM133924160

Assignment:

The average weekly demand for a piece of respiratory equipment was found to be 25 units with a lead time of 3 weeks. The standard deviation of lead time demand is known to be 10 units. The company plans to provide a service level that is 47.7% more than the mean lead time demand. Both demand and lead time follow a normal distribution. The company determined that an order of 250 units is the optimal order quantity for the item.

1. Identify the ordering policy for the item.

2. If the company decides not to eep any safety stocks, what service level can it achieve?

Reference no: EM133924160

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