Question

A warehouse distributor of carpet keeps 6,000 yards of deluxe shag carpet in stock during a month. The average demand for carpet from the stores that purchase from the distributor is 4,500 yards per month, with a standard deviation of 900 yards. What is the probability that a customer’s order will not be met during a month? (This situation is referred to as a stockout.)

Answer 1

The probability that a customer’s order will not be met during a month is 1.67.

Explanation:

Given : A warehouse distributor of carpet keeps 6,000 yards of deluxe shag carpet in stock during a month. The average demand for carpet from the stores that purchase from the distributor is 4,500 yards per month, with a standard deviation of 900 yards.

To find : What is the probability that a customer’s order will not be met during a month?

Solution :

Average Mean
`\mu=4500`

Sample Mean
`x=6000`

Standard deviation
`\sigma=900`

The formula is given by,

`Z=(x-\mu)/(\sigma)`

Substitute the value in the formula,

`Z=(6000-4500)/(900)`

`Z=(1500)/(900)`

`Z=1.67`

The probability that a customer’s order will not be met during a month is 1.67.