The injection modeling department of a company used 40 pounds of a powder a day. inventory is reordered when the amount on hand is 240 pounds. lead time averages five days. it is normally distributed and standard deviation of 2 days. what is the probability of a stockout during lead time?

the probability of stockout is 63.06%

Explanation:

since the time for stockout is 240 pounds /40 pounds/day = 6 days if there is no replenishment , then for a lead time of 6 days or more , there is stockout. If the random variable X= lead time , distributes normally then the probability of a stockout Ps will be:

Ps= P(X≥6 days)

for the normalised random variable Z

Z = (X-μ)/σ , where μ= expected value of X , σ = standard deviation of X

then

P(X≥6 days)=P(Z≥(6 days-5 days)/(2 days)) = P(Z≥ 0.5 )

from normal distribution tables

P(Z≥ 0.5 ) = 0.6306 = 63.06%

they can see what that city is producing and to also see if they can some how get that product. like gold in africa.

turnover

the amount of money taken by a business in a particular period.