Which of the following parameters is the minimal, sufficient information needed to calculate the reorder point in a continuous review system?

I.Lead Time

II.Average Demand during the lead time

III.Variability of demand during the lead time

IV.Daily variability of demand

V.Holding Cost

VI.Target Service Level over the Lead Time

Answers:

a) II, IV, VI

b) We need all of the given parameters.

c) I, II, V, VI

d) We also need other parameters beyond those given to calculate the reorder point

e) II, III, VI