Stereo Goods is a distributor of videotapes. Video Mart is a local retail outlet which sells blank and recorded videos. Video Mart purchases tapes from Stereo Goods at $ per tape. Video Mart does not inspect the tapes due to Stereo Goods' reputation for high quality. Annual demand is days to be tapes The purchaseorder lead time is days. The following cost data are available:
Relevant ordering costs per purchase order
$
Carrying costs per unit per year:
Relevant insurance, materials handling,
breakage, etc., per year
$
Required
Determine the economic order quantity
marks
Determine the appropriate level of safety stock, assuming stock out cost is $ per unit and the following estimated demand. Assume a unitinterval for each safety stock level increments
tableTotal Demand tapes during purchase order lead time,Probability
