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Consult figure 9 . 4 in the prescribed book ( both 7 t h and 8 t h editions ) . Which statement holds the
Consult figure in the prescribed book both and editions Which statement holds the truth about the reorder point system?
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During the replenishment lead time indicated by the arrows, usage is halted as shown by the declining inventory levels in both periods.
The order for replenishment is placed when safety stock levels are close to depletion as depicted by the safety stock dotted line.
The reorder quantity is the same every time an order is placed as seen by the steady horizontal line representing the reorder point.
During both periods outlined in the figure, it was necessary to use the safety stock, since the demand or usage during lead time was as expected.
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