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A regional distributor purchases discontinued appliances from various suppliers and then sells them on demand to retailers in the region. The distributor operates 5 days per week, 52 weeks per year. Only when it is open for business can orders be received. The following data are estimated for a countertop mixer: average daily demand is 100 mixers, standard deviation of daily demand is 30 mixers, lead time is 3 days, holding cost is $9.40 per unit per year, ordering cost is $35 per order, and cycle service level is 92 percent. If the distributor uses a periodic review P system, the target inventory level will be?

A regional distributor purchases discontinued appliances from various suppliers and then sells them on demand to retailers in the region. The distributor operates 5 days per week, 52 weeks per year. Only when it is open for business can orders be received. The following data are estimated for a countertop mixer: average daily demand is 100 mixers, standard deviation of daily demand is 30 mixers, lead time is 3 days, holding cost is $9.40 per unit per year, ordering cost is $35 per order, and cycle service level is 92 percent. If the distributor uses a periodic review P system, the target inventory level will be?

Practical Management Science
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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A regional distributor purchases discontinued appliances from various suppliers and then sells them on demand to retailers in the region. The distributor operates 5 days per week, 52 weeks per year. Only when it is open for business can orders be received. The following data are estimated for a countertop mixer: average daily demand is 100 mixers, standard deviation of daily demand is 30 mixers, lead time is 3 days, holding cost is $9.40 per unit per year, ordering cost is $35 per order, and cycle service level is 92 percent. If the distributor uses a periodic review P system, the target inventory level will be?

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