(Solved): 2. Chuck no Risk (CNC) has collected the following information on one of its products: Demand = 8,0 ...

2. Chuck no Risk (CNC) has collected the following information on one of its products: Demand = 8,000 units/year Standard deviation of weekly demand = 12 units Ordering costs = $30/order Holding costs = $5/unit/year Cycle-service level = 85% Lead-time = 2 weeks Number of weeks per year = 50 weeks a. If CNC uses the continuous review (Q) system to control the inventory, what would be the order size and reorder point? b. The firm decided to change to the periodic review (P) system to control the item's inventory. For the most recent review, an inventory clerk checked the inventory of this item and found 300 units. There were no scheduled receipts or backorders at the time. How many units should be ordered? (HINT: Use the EOQ model to derive P, the time between reviews.)