solution

Risk pooling can be implemented to: a) reduce inventory while maintaining the same service level. b) achieve a higher service level with the same level of inventory. c) reduce the demand uncertainty. d) achieve all of the above.

10) Products A and B have the same daily demand distribution; Normal with mean 200 and standard deviation of 20. The correlation coefficient between their demands is -.7. If we pool the demands for A and B, the mean and standard deviation of (daily) pooled demand distribution would be, respectively, a) 282.8427 and 28.2843 b) 282.8427 and 15.4919 c) 400 and 15.4919 d) 400 and 28.2843

 
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