Question #3 Weekly demand for a Motorola cell phone at a Best Buy store is normally distributed, with a mean of 240 and standard deviation of 160.

Question #3

Weekly demand for a Motorola cell phone at a Best Buy store is normally distributed, with a mean of 240 and standard deviation of 160. Best Buy has a policy of ordering the cell phones in lots of 3000. Motorola takes four 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?