GATE ME 2014 Set 4 — Question 29
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Engineering Mathematics → Inventory Control → Expectation & Moments
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Question
Demand during lead time with associated probabilities is shown below:
Expected demand during lead time is _______
| Demand | 50 | 70 | 75 | 80 | 85 |
|---|---|---|---|---|---|
| Probability | 0.15 | 0.14 | 0.21 | 0.20 | 0.30 |
Correct answer
74 to 75
Solution
The expected demand during lead time is calculated as the weighted average of all possible demand values, where the weights are their respective probabilities.Expected Demand Given the data from the table:
Thus, the expected demand during lead time is 74.55.
Thus, the expected demand during lead time is 74.55.
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