You and the other shoe store owners decide to fix your shoe prices at $60 a pair in order to maximize your profits. This is call
2 answers:
You might be interested in
Answer:
The target inventory position is T= 713.6 gallons.
Explanation:
Given:
Average demand =per day = D = 152 Gallons
Standard deviation of demand = σ = 33 Gallons per day
Lead time for delivery = L = 4 days
Z value for 94.5% service level = 1.6
The target inventory position = (Average demand x Lead time) + Safety stock
= (D × L) + (Z× σ × )
= (152 × 4) + (1.6 × 33 × )
= (152 × 4) + (1.6 × 33 × 2)
= 608 + 105.6
= 713.6