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April 9, 2021

Demand for walnut fudge ice

General Questions

Demand for walnut fudge ice cream at the Sweet Cream Dairy can be approximated by a normal distribution with a mean of 21 gallons per week and a standard deviation of 3.5 gallons per week. The new manager desires a service level of 90%. Lead time is 2 days, and the dairy is open 7 days a week. (HInt: Work in terms of weeks)

a. If an ROP model is used, what Rop would be consistent with the desired service level?

b.If a fixed-interval model is used instead of an ROP model, what order size would be needed for the 90 % service level with an order interval of 10 days and a supply of 2 gallons of hand at the order time?

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