$14$

Homework Grade for Module $3.$

Honorlock

Question $10$

$10pts$

A store has collected the following information on one of its products:

Demand $=10,000$ units$/$year; Standard deviation of weekly demand $=25$ units

Ordering costs $=$$$\frac{30}{?}$ order; Holding costs $=$$$\frac{4}{?}$ unit$/$year

Cycle$-$service level $=95\%$; Lead$-$time $=2$ weeks; Number of weeks per year $=50$ weeks

The firm decided to change to the periodic review system to control the item's inventory. What is the target inventory level?

$($hint: calculate EOQ and TBO to determine P$...$as in the problem solved in class$)$

$883$

$683$

$458$

$800$