Which One of the Following Is Implied by a Lead

question 52

Multiple Choice

Which one of the following is implied by a lead time service level of 95 percent?

• A)Approximately 95 percent of demand during lead time will be satisfied.
• B)Approximately 95 percent of inventory will be used during lead time.
• C)The probability is 0.95 that demand during lead time will exactly equal the amount on hand at the beginning of lead time.
• D)The probability is 0.95 that demand during lead time will not exceed the amount on hand at the beginning of lead time.
• E)The probability is 0.95 that the order will arrive after the on-hand inventory is exhausted.

---

Definitions:

Debtor

An individual or organization that owes money to another party, known as the creditor.

Security Agreement

A legal document that provides a lender a security interest in a specified asset or property that is pledged as collateral for a loan, in case of borrower default.

Authenticated Record

A document verified as genuine, usually through a process that confirms its origin and integrity.

Collateral

Collateral refers to assets that a borrower offers to a lender as security for a loan, which can be seized if the loan is not repaid according to the terms of the loan agreement.