Scenario 12.2 - Hamsterdam

Multiple Choice

Scenario 12.2 - Hamsterdam
Marlo Stanfield's operation also uses large quantities of prepaid cell phones,on average 1500 per week with a standard deviation of 145.The lead time for their own brand of prepaid cell phones is three weeks and they have a lot size of 350 phones.To ensure they never run out,they keep a safety stock of 500 phones with Proposition Joe.
-What is the expected shortage per cycle under this policy?

A) 1 phone
B) 2.2 phones
C) 4.5 phones
D) 9.8 phones