What impact would policy have on level of cycle inventory

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Reference no: EM13954045

For a repetitive ordering situation (with reorder points), describe the inventory control policy that would prevent shortages while carrying minimal inventory, if fixed ordering costs (S) and quantity discounts were negligible and thus not important factors to consider. In other words:

(1) how would you determine the reorder point R (high, or low) and the ordering quantity Q (high, or low), and;

(2) what impact would your policy have on level of cycle inventory (high, or low) and ordering frequency (frequent, or infrequent)?

Reference no: EM13954045

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