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24 February, 06:13

Daily usage is exactly 60 gallons per day. lead time is normally distributed with a mean of 10 days and a standard deviation of 2 days. what is the standard deviation of demand during lead time? 60 times 10 60 times the square root of 10 60 times the square root of 2 10 times the square root of 2 60 times 2

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  1. 24 February, 09:54
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    We are told that the daily usage is exactly 60 gallons per day, therefore the total number of gallons that is used during the mean lead time is also called the mean demand amount:

    Mean demand amount = Daily usage * Mean lead time

    Mean demand amount = (60 gallons / day) * 10 days

    Mean demand amount = 600 gallons

    Since the standard deviation of the lead time is 2 days, therefore the standard deviation of the demand should also be:

    Standard deviation of demand = Daily usage * Standard deviation of lead time

    Standard deviation of demand = (60 gallons / day) * 2 days

    Standard deviation of demand = 120 gallons

    Short answer:

    60 times 2
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