Use the following details for the next question A company operating under a continuous review system has an average demand of 50 units per week for the item it produces. The average lead time for the item is 6 weeks. It costs the company $30 to process each order. The holding cost for each unit is $10 per year. The company operates 52 weeks per year. Question 8 If the company desires a 90% service level and demand is constant but the standard deviation of lead time is 1.5 weeks, what is the required safety stock quantity? O Less than or equal to 100 units Greater than 100 units and less than or equal to 250 units O Greater than 250 units but less than or equal to 400 units Greater than 400 units

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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Use the following details for the next question
A company operating under a continuous review system has an average demand of 50 units per
week for the item it produces. The average lead time for the item is 6 weeks. It costs the company
$30 to process each order. The holding cost for each unit is $10 per year. The company operates
52 weeks per year.
Question 8
If the company desires a 90% service level and demand is constant but the standard deviation of
lead time is 1.5 weeks, what is the required safety stock quantity?
O Less than or equal to 100 units
Greater than 100 units and less than or equal to 250 units
O Greater than 250 units but less than or equal to 400 units
Greater than 400 units
Transcribed Image Text:IS ncements es sions ments es s 15 60 Recordings y Resources nt Evaluation ching Use the following details for the next question A company operating under a continuous review system has an average demand of 50 units per week for the item it produces. The average lead time for the item is 6 weeks. It costs the company $30 to process each order. The holding cost for each unit is $10 per year. The company operates 52 weeks per year. Question 8 If the company desires a 90% service level and demand is constant but the standard deviation of lead time is 1.5 weeks, what is the required safety stock quantity? O Less than or equal to 100 units Greater than 100 units and less than or equal to 250 units O Greater than 250 units but less than or equal to 400 units Greater than 400 units
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