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Reorder Point Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An order to replenish the

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Reorder Point Sterling Corporation has an EOQ of 5,000 units. The company uses an average of 500 units per day. An order to replenish the part requires a lead time of five days. Required: 1. Calculate the reorder point, using (Reorder point = Rate of usage x Lead time). units 2. Select the graph that displays the appropriate reorder point. Inventory (units) EOQ 2.500 Inventory (units) E0Q -5,000 ROP -2.500 ROP 2.500 0 5 15 20 0 5 15 20 10 Days 10 Days Inventory (units) ROP 5.000 d. Inventory (units) EDO 5000 EOQ 2.500 ROP 2,500 0 5 10 15 20 0 10 15 20 Correct answer is 3. What if the average usage per day of the part is 500 units but a daily maximum usage of 575 unit is possible? What is the reorder point when this demand uncertainty exists? units

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