Desired during the reorder interval-what is reorder point

Assignment Help Operation Management

Reference no: EM131034976

Annual demand for an item is 18,000 units with the cost per unit at $440. The holding rate is 8% and the order cost is $21.00 per order. The standard deviation of daily demand is 2 units. Assume 263 days in the year and a lead-time of 7 days. If a service level of 98% is desired during the reorder interval, what is the reorder point?

A. ≈478 units

B. ≈490 units

C. ≈501 units

D. ≈532 units

Reference no: EM131034976

Questions Cloud

Airline passengers are broadly segmented : Airline passengers are broadly segmented by purpose of travel. Characterize the two major segments by price elasticity of demand. What is the implication for the price each segment will pay for air travel?

Determine the coefficient of static friction at a : The 50-kg uniform pole is on the verge of slipping at A when θ= 45 °

Explain how the government uses fiscal and monetary policy : Explain how the government uses fiscal and monetary policy to expand or contract the economy. Be sure to indicate the impact of fiscal and monetary policy on such important variables as employment, interest rates, GDP and government revenue.

Delta neutral portfolio of call options and stock : Consider an option on a non-dividend-paying stock when the stock price is $45, the strike price is $42, the risk-free interest rate is 5% per annum, the volatility is 25% per annum, and the time to maturity is five months. It can be shown that d1=..

Desired during the reorder interval-what is reorder point : Annual demand for an item is 18,000 units with the cost per unit at $440. The holding rate is 8% and the order cost is $21.00 per order. The standard deviation of daily demand is 2 units. Assume 263 days in the year and a lead-time of 7 days. If a se..

The hearst and minds of people in a society : How does one win the hearst and minds of people in a society?

Install and maintain a computerized record system : Halifax Ciorp. contracted with the city of Richmond to create, install, and maintain a computerized record system. The contract stated that BIS would be hired as a subcontractore. The work was to be done n two phases. After the first phase, the city ..

Fudge the facts-what measurement system dilemmas are present : In an attempt to improve quality, the shop superintendent at FWM Inc. has instructed all work cell supervisors to keep records of waste, scrap, and rework items. These records will be reviewed periodically at irregular intervals to identify which wor..

Estimated times interest earned ratio : Manufacturer's Inc. estimates that its interest charges for this year will be $700 and that its net income will be $3,000. Assuming its average tax rate is 30%, what is the company's estimated times interest earned ratio?

User Account

All Pages