Lead time is exactly 20 days long.Daily demand is normally distributed with a mean of 10 gallons per day and a standard deviation of 2 gallons.What is the standard deviation of demand during lead time?
A)20* 2
B)20* 10
C)2 times the square root of 20
D)2 times the square root of 10
E)40 days

Question

Quizplus · Accepted Answer

The standard deviation of demand during lead time is calculated by multiplying the daily standard deviation by the square root of the lead time. Therefore, it is $2 \times \sqrt{20}$.

Lead Time Is Exactly 20 Days Long