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14 May, 20:24

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

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  1. 14 May, 22:24
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    The standard deviation of demand during lead time is 60*2

    Step-by-step explanation:

    Let us recall the following statements from the given question,

    The daily usage is = 60 gallons per day,

    Then,

    The total number of gallons that is used during the mean time lead can be referred to the demand mean amount:

    The Mean demand amount = Daily usage x Mean lead time

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

    Mean demand amount = 600 gallons

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

    The Standard deviation of demand = The Daily usage x Standard deviation of lead time

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

    Standard deviation of demand = 120 gallons

    Or 60 times 2 or 60 x 2
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