Which one of the following is implied by an "annual" service level of 95 percent?
A)Approximately 95 percent of demand between orders will be satisfied.
B)The probability is 95 percent that all demand over the year will exceed supply.
C)The probability is 95 percent that all demand over the year will equal supply.
D)The probability is 95 percent that all demand over the year will not exceed supply.
E)Approximately 95 percent of demand between orders will be lost.

Question

Quizplus · Accepted Answer

An "annual" service level of 95 percent implies that there is a 95 percent probability that all demand over the year will not exceed supply, meaning the supply will meet or exceed the demand 95 percent of the time.

Which One of the Following Is Implied by an "Annual