Subjects operations management

Safety Inventory Cffa78

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1. **State the problem:** Calculate the safety inventory given the lead time, average weekly usage, and maximum weekly usage. 2. **Formula used:** Safety inventory is calculated as: $$\text{Safety Inventory} = (\text{Maximum Weekly Usage} - \text{Average Weekly Usage}) \times \text{Lead Time}$$ 3. **Substitute the values:** $$= (90 - 70) \times 9$$ 4. **Calculate the difference:** $$= 20 \times 9$$ 5. **Multiply to find safety inventory:** $$= 180$$ 6. **Interpretation:** The safety inventory is 180 units, which means you should keep 180 units as a buffer to cover fluctuations in demand during the lead time. **Final answer:** 180 units.