Consider the Following Conditions for an Item Used in the Hess

question 4

Multiple Choice

Consider the following conditions for an item used in the Hess Company's manufacturing process:
Which of the following statements best describes Hess's situation regarding inventory replenishment?

• A) No action is required, since Hess's inventory position is greater than the reorder point.
• B) Hess should order one lot of 50 units to cover its backorders.
• C) Because it is incurring backorders, Hess should increase its reorder point.
• D) Hess should place an order for 50 units, since their inventory position is less than the reorder point.

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Definitions:

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