K the Constant Used for Lot Sizing Is Calculated as The

question 22

Multiple Choice

K the constant used for lot sizing is calculated as the:

• A) Order point minus safety stock.
• B) Sum of the square roots of demand divided by the number of orders per year.
• C) Standard deviation of the demand divided by the square root of demand.
• D) Annual demand divided by the order quantity.
• E) The reciprocal of order quantity times the economic order quantity.

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Definitions:

z

A statistical measure representing the number of standard deviations a data point is from the mean of a distribution.

Exponential Probability Distribution

A statistical distribution used to model the time between events in a Poisson process, characterized by a constant rate of occurrence.

Continuous Distribution

A probability distribution in which the variable can assume an infinite number of values within a given range.

Normally Distributed Random Variable

A random variable that has its values following a normal distribution, characterized by its mean and standard deviation.