Hora plc holds inventories of a particular type of motor car tyre, which is ordered in batches of 1,200 units. The supply lead times and usage rates for the tyres are:

The business wishes to avoid the risk of running out of inventories.

At what minimum level of inventories should Hora plc place a new order, such that it can guarantee not to run out?

What is the size of the buffer inventories based on the most likely lead times and usages?

If Hora plc were to place an order based on the maximum lead time and usage, but only the minimum lead time and usage were actually to occur, what would be the level of inventories immediately following the delivery of the new inventories? What does this inventories figure represent?

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Supply lead times Daily usage Maximum 25 days 30 units Most likely 15 days 20 units Minimum 8 days 12 units