What is the safety stock and statistical reorder point

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Reference no: EM131729293

A golf specialty wholesaler operates 50 weeks per year. Management is trying to figure out an inventory policy for its 1-irons, which have the following characteristics:

• Annual demand = 2000 units per year

• Demand is normally distributed

• Standard deviation of weekly demand = 3 units

• EOQ = 150 units • Lead time = 4 weeks

What is the safety stock and statistical reorder point that leads to a service level of 95% (assume z = 1.64)?

What would be the reorder point for a service level of 99% (assume z = 2.33)?

Reference no: EM131729293

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