Assignment:
For a given inventory item, demand averages 80 units per week, with a standard deviation of 3 units. Lead time for this item is a constant 6 weeks, and based on this lead time the reorder point has been set at 494 units. What is the stockout risk associated with this particular reorder point?
A) Not in excess of 5%
B) In excess of 5% but not in excess of 6.8%
C) In excess of 6.8% but not in excess of 8.6%
D) In excess of 8.6% but not in excess of 10.2%
E) In excess of 10.2%
Your answer must be typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.