Daily demand for gaming consoles at a MegaMart store is normally distributed with a mean of 28 units and a standard deviation of 9. The supplier, Mark's PC Warehouse, takes on average about 5 days to supply a MegaMart order. The standard deviation of lead time is 2 days. MegaMart is targeting a customer service level of 95 percent (z = 1.65) and monitors its inventory continuously. How much safety inventory of gaming consoles should MegaMart carry? What should their reorder point (ROP) be?
Megamart should carry 85 units of safety stock and should order their optimal quantity at 251 units
Megamart should carry 100 units of safety stock and should order their optimal quantity at 231 units
Megamart should carry 169 units of safety stock and should order their optimal quantity at 245 units
Megamart should carry 98 units of safety stock and should order their optimal quantity at 238 units