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The following information is available for a firm: Demand = 5,200 units/year Standard deviation of weekly demand = 11 units Ordering costs = $45/order Holding
The following information is available for a firm:
- 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%
- Lead-time = 3 weeks
- Number of weeks per year = 52 weeks
If a firm uses a continuous review system to control the inventory, what would be the reorder point?
A. Between 600 and 1200 units
B. above 1200 units
C. between 1 and 300 units
D. between 301 and 600 units
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