Weekly demand for a Motorola cell phone at a Best Buy store is normally distributed, with a mean of 200 and standard deviation of 150. Best Buy has a policy of ordering the cell phones in lots of 500. Motorola takes two weeks to deliver an order. If Best Buy is targeting a CSL of 95 percent and monitors its inventory continuously:
a. How much safety inventory of cell phones should Best Buy carry?
b. What should its ROP be?
If Best Buy is targeting a fill rate of 99 percent and monitors its inventory continuously:
c. How much safety inventory of cell phones should Best Buy carry?
d. What should its ROP be?