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After graduation, you decide to go into a
You choose, as your first item for study, computer printer paper. You examine the sales records and purchase orders and find that demand for the past 12 months was 5,000 boxes. Using your calculator, you sample some days' demands and estimate that the standard deviation of daily demand is 10 boxes. You also search out these figures:
Cost per box of paper: $11
Desired service probability: 98 percent
Store is open every day.
Salesperson visits every two weeks.
Delivery time following visit is three days.
Using your procedure, how many boxes of paper would be ordered if, on the day the salesperson calls, 60 boxes are on-hand?
Note: Use 365 days a year. Use Excel's NORM.S.INV() function to find the z value. Round z value to 2 decimal places and final answer to the nearest whole number.
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