SAUCE uses 300,000 units of part X a year. Average purchase lead time is 20 working days while maximum is 27 working days. The firm's annual operations cover 240 days allowing for shutdowns for plant maintenance, holidays and Sundays. The firm wants to keep safety stock to guard against stock outs. What is the safety stock in units
SAUCE uses 300,000 units of part X a year. Average purchase lead time is 20 working days while maximum is 27 working days. The firm's annual operations cover 240 days allowing for shutdowns for plant maintenance, holidays and Sundays. The firm wants to keep safety stock to guard against stock outs. What is the safety stock in units
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter4: Extent (how Much) Decisions
Section: Chapter Questions
Problem 4.4IP
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SAUCE uses 300,000 units of part X a year. Average purchase lead time is 20 working days while maximum is 27 working days. The firm's annual operations cover 240 days allowing for shutdowns for plant maintenance, holidays and Sundays. The firm wants to keep safety stock to guard against stock outs.
What is the safety stock in units?
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