Question: Brussels Inc uses the Continuous Review System for managing its inventory. The annual demand for its product is 18,000 units. Cost to hold 1 unit
- Brussels Inc uses the Continuous Review System for managing its inventory. The annual demand for its product is 18,000 units. Cost to hold 1 unit of inventory for 1 year is $10.50 and the cost it incurs to place an order is $60.00. The weekly demand rate for the item is 100 units and standard deviation of weekly demand is 24 units. The lead time to receive items ordered from its suppliers is 3 weeks. It guarantees its customers that 97.5% of the time they place an order, they would be able to provide the item. Determine the following:
- The Economic Order Quantity (EOQ) in units
- The optimal time between orders in weeks, assuming there are 52 weeks per year
- The safety stock and reorder point (both in units)
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