Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A pharmacist is trying to determine the inventory order and stock levels for a particular drug. The following information is available about the drug.

A pharmacist is trying to determine the inventory order and stock levels for a particular drug. The following information is available about the drug. Demand (D) 85 tablets/week Working weeks per year 52 weeks Unit holding cost per year (H) $6 Order cost (S) $44/order Standard deviation of weekly demand (d) 15 tablets Lead time (L) 2 weeks Desired cycle service level 95%. a) If the pharmacist uses the continuous review (Q) system to control the inventory of the drug, what would be the order quantity and reorder point? b) If the pharmacist uses the periodic review (P) system to control the inventory of the drug, what would be the review interval and target inventory level? (Hint: Use the EOQ model to derive the review interval P)

Step by Step Solution

3.47 Rating (147 Votes )

There are 3 Steps involved in it

Step: 1

To calculate the order quantity and reorder point for the continuous review Q system and the review ... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting Information System

Authors: James A. Hall

7th Edition

978-1439078570, 1439078572

More Books

Students also viewed these General Management questions

Question

What are the computer ethical issues regarding privacy?

Answered: 1 week ago