Problem:
Chicago's Hard Rock Hotel distributes a mean of 1,200 bath towels per day to guests at the pool and in their rooms. This demand is normally distributed with a standard deviation of 95 towels per day. The laundry firm that has the contract requires a 4-day lead time. the hotel expects a 98% service level to satisfy high guest expectations.
Required:
Question 1) What is the reorder point?
Question 2) What is the Safety stock?
Solve the problem and show all work.