Question 1/(1 point The brothers who go to Mothers a new venture of Block C Ente

Question

Question 1/(1 point The brothers who go to Mothers a new venture of Block C Enterprises, have expressed a strong preference for Rheingold's Sigtried pilsner to the extent that Mother's believes that l they must be able to satisfy demand 995% l the time. Demand averages 70 bottles per day with a standard deviation on demand of 20 bottles per day Lead time for delivery is 2 day with a standard deviation of 1 day. Determine the reorder point for Sigfried pilsner. 248 botules 290 bottles 334 bottles 876 bottes 367 botles 487 Dotles 508 botles 578 bottles

Explanation / Answer

Demand (D) = 70

Lead time (LT) = 2

SDd (Standard deviation of demand) = 20

SDt (Standard deviation of lead time) = 1

z value for 99.5% service level = 2.57

Re-order point = D*LT + z*sqrt(LT*SDd^2 + D^2*SDt^2) = 70*2 + 2.57*sqrt(2*20^2 + 70^2*1^2) = 334

Ans: 334

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