The Materials Manager for a Billiard Ball Maker Must Periodically

question 25

Multiple Choice

The materials manager for a billiard ball maker must periodically place orders for resin,one of the raw materials used in producing billiard balls.She knows that manufacturing uses resin at a rate of 50 kilograms each day,and that it costs $.04 per day to hold a kilogram of resin in inventory.She also knows that the order costs for resin are $100 per order,and that the lead time for delivery is four (4) days. If the order size was 1,000 kilograms of resin,what would be the average inventory level?

• A)50 kilograms
• B)200 kilograms
• C)500 kilograms
• D)800 kilograms
• E)1,000 kilograms

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