Problem:
54,000 units per year at $8 per unit
360 day-per year basis
$90 cost to place a single order
$3 to carry on unit in inventory one year
lead-time % of occurrence
6 75
7 10
8 5
9 5
10 5
Company willing to assume 15% risk of being out of stock what is the safety stock...what is the reorder point
Company willing to assume 5% risk of being out of stock what is the safety stock ....what is the reorder point