# Formulas and Equations¶

The formal expression of the formulas and equations used in the library are detailed here.

$LD = LT \times D$
where:

D = Demand

## Standard Deviation of Lead-time demand¶

$\sigma_{LTD} = \sqrt{LT \times \sigma_{D}^2 + D^2 \times \sigma_{LT}^2}$
where:

sigma_{LTD} = Standard deviation of lead-time demand

D = Demand

## Reorder Level¶

The formula used for calculating the reorder level is:

$RL = LT \times D + Z \times \sigma \times \sqrt{LT}$
where:

Z = service level

D = Demand

## Safety Stock¶

The formula used for safety stock is:

$SS = Z \times \sigma \times \sqrt{LT}$
where:

SS = Safety Stock

Z = service level

$eoq_{0} = \sqrt \frac{2 \times R \times D}{HC}$