Question: Suppose that you are using a continuous review system. If on-hand inventory is 400 units, scheduled receipts equal 1000 units, there is a backorder for

Suppose that you are using a continuous review system. If on-hand inventory is 400 units, scheduled receipts equal 1000 units, there is a backorder for 500 units, the reorder point is 500 units, and the EOQ based on holding and setup costs is 1000 units, how many units should be ordered?

A. 100

B. 1000

C. 0

D. 500

E. 400

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