Table $5.7$ Demand $= 5200$ Units/year
Standard Deviation of Weekly Demand $= 11$

question 11

Multiple Choice

Table $5.7$
Demand $= 5200$ units/year
Standard deviation of weekly demand $= 11$ units
Ordering costs $= \$ 45 /$ order
Holding costs $= \$ 2 /$ unit/year
Cycle-service level $= 90 \% ($ z for $90 \% = 1.28 )$
Lead time $= 3$ weeks
Number of weeks per year $= 52$ weeks
-Use the information in Table 5.7. The firm decided to change to the periodic review system to control the item's inventory. For the most recent review, an inventory clerk checked the inventory of this item and found 500 units. There were no scheduled receipts at the time. How many units should be ordered? (HINT: Use the EOQ model to derive P, the time between reviews.)

• A) 0 units
• B) greater than 0 but less than or equal to 300 units
• C) greater than 300 but less than or equal to 600 units
• D) above 600 units

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Definitions:

Unauthorized Act

An action taken without official permission, potentially violating legal or organizational rules.

Principal

In agency law, the individual or entity that authorizes an agent to act on their behalf in business transactions.

Agent

An individual or entity authorized to act on behalf of another person or entity in legal or business matters.

Defraud

The act of misleading or deceiving someone typically for financial or personal gain.