Scenario 9.9 Demand = 5,200 Units/year

Scenario 9.9
Demand = 5,200 units/year
Standard deviation of weekly demand = 11 units
Ordering costs = $45/order
Holding costs = $2/unit/year
Cycle-service level = 90% (z for 90% = 1.28)
Lead-time = 3 weeks
Number of weeks per year = 52 weeks
-Use the information in Scenario 9.9.If a firm uses the continuous review system to control the inventory,what would be the reorder point?

A) 0 units
B) greater than 0 but less than or equal to 300 units
C) greater than 300 but less than or equal to 600 units
D) greater than 600 units

Correct Answer:

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Access For Free