• Daily demand follows a normal distribution with mean µ0 = 30 units/ day, yielding an expected annual demand of D = 30 x 365 = 10,950 units/ year, and standard deviation cr0 = 8 units/ day.
• Lead time follows a normal distribution with mean µL = 5 days and standard deviation crL = 1.5 days.
• Annual holding cost is h = $5 per unit, based on an item cost of c = $20 and an annual holding cost rate of i = 25°/o.
• Fixed ordering cost is A = $80 per order, covering various administrative costs related to placing orders with the supplier, coordinating with the TL carrier while goods are en route, and receiving and stocking the item when it arrives at the Atlanta RDC.
• Item weight is w = 10 lb/ unit.
• Item density is s = 9.72lb/ft3 (chosen in light of later discussion in the chapter).
• The shipment distance is d = 2463 mi.*