Answered: Pep Zone sells auto parts and supplies…

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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Question

Pep Zone sells auto parts and supplies including a popular multi-grade motor oil. When the stock of
this oil drops to 40 gallons, a replenishment order is placed. The store manager is concerned that sales
are being lost due to stockouts while waiting for a replenishment order. It has been determined that
demand during replenishment lead-time is normally distributed with a mean of 25 gallons and a
standard deviation of 9 gallons. The manager would like to know the probability of a stockout during
replenishment lead-time. In other words, what is the probability that demand during lead-time will
exceed 30 gallons?

Use Microsoft Excel in computing the following problems. Show screenshots of your answer.

Features Features Normal distribution is characterized by two parameters, mean (µ) and standard deviation (σ). When graphed, the mean represents the center of the bell curve and the graph is perfectly symmetric about the center. The mean, median, and mode are all equal for a normal distribution. The standard deviation measures the data's spread from the center. The higher the standard deviation, the more the data is spread out and the flatter the bell curve looks. Variance is another commonly used measure of the spread of the distribution and is equal to the square of the standard deviation.

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