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Reorder Point - ROP

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Daily demand is almost constant at 12,500 units. The lead time is normally distributed with a mean of 4 days and a standard deviation of 1 day. A 97% service level is expected.

A. What is the Z value?
B. What is the ROP?
C. Only the lead time variable in this problem?

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Solution Summary

The expert examines reorder point for ROP. The z-value is determined.

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A)Z Value = 1.88 (from normal table where area below z = 0.97)

B) ROP = Mean ...

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