Magazine Luiza is a Brazilian retail chain for consumer elec-
tronics. The company currently has 100 stores distributed
across Brazil. It also operates an online channel. It is consid-
ering introduction of a new printer and must decide whether
to offer it at retail stores or the online channel. Weekly
demand for the printer at each store has been forecast to be
normally distributed with a mean of 100 and a standard devi-
ation of 80. The company has also forecast that the demand at
the online channel would be the sum of demand across all
100 stores. The supplier will take four weeks to fulfill a
replenishment order, whether placed separately by each store
or by the online DC. Magazine Luiza is targeting a CSL of
95 percent and monitors its inventory continuously. How
much safety inventory will Magazine Luiza carry if the
printer is carried at all 100 stores? How much safety inven-
tory will Magazine Luiza carry if the printer is carried online
and demand across stores is independent? How much safety
inventory will Magazine Luiza carry if the printer is carried
online and demand across stores has a correlation coefficient
of r = 0.3?