Question: Music Mania sells MP3 players to its customers. Music Mania orders 300 MP3 players from its supplier when its inventory reaches 80 units. Daily demand for MP3 players is discrete, uniformly distributed between 30 and 60 (both inclusive). The lead time from the supplier also varies for each order and is discrete, uniformly distributed between 1 and 3 days (both inclusive). The cost to hold 1 unit in inventory for one day is $0.50. The cost to place an order is $100. Stockout cost per unit is estimated at $20. Initial inventory is 300 units.
Simulate this inventory policy for a quarter (90 days) and calculate the total quarterly cost. Also calculate the percentage of stockouts for the quarter. Replicate these calculations N times each to calculate the average values for these measures.