A company begins a review of ordering policies [or its continuous review system by checking the current policies for a sample of SKUs. Following are the characteristics of one item. Demand (D) =64 units/week (Assume 52 weeks per year) Ordering and setup cost IS) = $50/order Holding cost (11) = $13/unit/year Lead time (L) = 2 weeks Standard deviation of uvsk1y demand = 12 units Cycle-service level = 88 percent a. What Is the EOQ for this item? b. What is the desired safety stock? c. What is the reorder point? d. What are the cost implications if the current policy for this Item is Q = 200 and R = 180?
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