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Business, 06.05.2020 03:32 leannehounschell

You work for the company Ice Ginger, which manufactures "refreshing" beverages for use in bar mixers. Due to the random nature of demand for mixers (not every weekend is a bar weekend!), your firm has decided that they want to carry safety stock and thus will need to change the reorder point for their inventory. The demand for mixers is normally distributed with an average demand of 1,000 units per day and a standard deviation of 150 units. Because Ice Ginger manufactures their own mixers, the lead-time for mixers is essentially constant at 4 days. (Total 10 points) a. Given the above information, please calculate the reorder point for the manufacture of mixers if the firm Ice Ginger wants an 85% service level. (2 Points) b. Due to customer outrage at the unavailability of mixers, the firm has decided to update their reorder point again. Using the same parameters as above, please calculate the reorder point if Ice Ginger wants a 90% service level. (2 Points) c. Due to continued outrage at the unavailability of mixers (must be a college town), Ice Ginger has decided to YET AGAIN update their reorder point. Using the same parameters as above, please calculate the reorder point if Ice Ginger wants a 95% service level. (2 points) d. Which of the increases in service level (from 85% to 90% or from 90% to 95%) led to a larger increase in the reorder point? Why do you think this is the case? (4 points)

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You work for the company Ice Ginger, which manufactures "refreshing" beverages for use in bar mixers...
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