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A Grocery Store Is Aiming for a 95% Service Level

Question 32

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A grocery store is aiming for a 95% service level for 1 gallon bottles of whole milk.The mean demand during lead time is 200 with a standard deviation of 40.Milk has a carrying cost of $0.50 per unit per year.How much safety stock should the grocery store maintain in milk and what is the reorder point?

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