Managing Supply Chain and Operations 1st Edition by Thomas Foster ,Scott Sampson,Cynthia Wallin,Scott Webb

Exercise 12

Calculate the reorder point and the annualized cost of safety stock for the situation in which daily demand is 125, the lead time is three days, the standard deviation of demand during lead time is 30, the desired service level is 95%, the opportunity cost of capital is 25%, and the items unit cost is $50.