A Pottery Located In Virginia Manufactures A Variety Of Coffee Mugs Vases Bowls Etc A Particular Coffee Mug With A V 1 (72.8 KiB) Viewed 18 times
A Pottery Located In Virginia Manufactures A Variety Of Coffee Mugs Vases Bowls Etc A Particular Coffee Mug With A V 2 (32.28 KiB) Viewed 18 times
A pottery located in Virginia manufactures a variety of coffee mugs, vases, bowls, etc. A particular coffee mug with a Virginia Tech logo on it is quite popular. Demand for this mug occurs throughout the year. The pottery manufactures the VT mug in batches of 2,000. Each batch is received from the pottery's manufacturing plant into the pottery's inventory. From there it is sold to customers. The production schedule is determined by the reorder point for the mugs. When the inventory of mugs falls to the reorder point, the pottery begins production of another batch. This production run requires one week. Experience has shown that weekly demand for the VT mugs is normally distributed with a mean of 400 mugs and a standard deviation of 100 mugs. If the pottery does not have enough VT mugs on hand to fill a customer's order, the unmet demand is backordered.
12. If the pottery uses a reorder point of 550 mugs, then over the long run, what percentage of the batches will be received from the manufacturing plant too late to prevent stockouts? a) ≤ 10% b) > 10% and ≤ 20% c) > 20% and ≤ 30% d) > 30%
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