Question: Demand = 5 0 , 0 0 0 units / week Standard deviation of weekly demand = 2 5 , 0 0 0 units Average

Demand =50,000 units/week
Standard deviation of weekly demand =25,000 units
Average lead time =8 weeks
Cycle-service level =98%
A continuous review system is used to control inventory.
With the information in the scenario above, what reorder point should the firm use for this product?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!

Q:

for the following data, calculate economic order quantity (EOQ) and re-order point (RP). as 50 weeks in a year. Item cost: AED 12000 Order cost: AED 300000/ order Annual holding cost: 25% of item...

Q:

The Office Supply Shop estimates that the average demand for a popular ball-point pen is 8,000 pens per week with a standard deviation of 500 pens. The average lead time from the distributor is 4...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year Item cost Order cost Annual holding cost (%) Annual demand Average demand $9.00 $230.00...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $9.00 Order cost $258.00 /order Annual holding cost 30 % of...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $ 9.00 Order cost $ 202.00 per order Annual holding cost 28%...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $10.00 Order cost $215.00 /order Annual holding cost 27 % of...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $10.00 Order cost $215.00 /order Annual holding cost 27 % of...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $11.00 Order cost $257.00 /order Annual holding cost 32 % of...

Q:

Given the following information, formulate an inventory management system. The item is demanded 50 weeks a year. PARAMETER VALUE Item cost $8.00 Order cost $178.00 /order Annual holding cost 29 % of...

Q:

Given the following Information, formulate an inventory management system. The item is demanded 50 weeks a year Item cost Order cost Annual holding cost (5) Annual demand Average demand 57.00 $181.00...

Q:

Where do ethical and sustainable sourcing policies come from in an organization?

Q:

Suppose you invest $1000 per year in a savings account starting one year from today and ending 20 years from today, that is, you make your first deposit EOY 1 and your last deposit EOY 20. In...

Q:

Question 1 ( 5 Points ) Microhard has issued a bond with the following characteristics: Par: $ 1 , 0 0 0 Time to maturity: 1 7 years Coupon rate: 8 percent Semiannual payments Calculate the price of...

Q:

Problem 15-48 Accounting for long-term investments in securities; with and without significant influence P3 P4 Brinkley Company, which began operations on January 3, 2015, had the following...