The Annual Demand for a Product Has Been Projected at 2,000

question 36

Multiple Choice

The annual demand for a product has been projected at 2,000 units.This demand is assumed to be constant throughout the year.The ordering cost is $20 per order,and the holding cost is 20 percent of the purchase cost.The purchase cost is $40 per unit.There are 250 working days per year.Whenever an order is placed,it is known that the entire order will arrive on a truck in 6 days.Currently,the company is ordering 500 units each time an order is placed.What level of safety stock would give a reorder point of 60 units?

• A)10
• B)14
• C)18
• D)12
• E)22

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Definitions:

Separation Anxiety

Emotional distress seen in individuals, often children, due to separation from those to whom they are emotionally attached.

Nonverbal Decoding

The process of interpreting and understanding nonverbal cues in communication, such as gestures, facial expressions, and body language.

Nonverbal Expression

Communication without the use of spoken language, involving gestures, body language, facial expressions, and other physical ways to convey messages.

Emotions

Complex psychological states that involve physiological arousal, expressive behaviors, and conscious experience.