What Is the Optimal Length of One Inventory Cycle for a Firm

question 33

Multiple Choice

What is the optimal length of one inventory cycle for a firm that has an economic order quantity of 750 units, average daily demand of 68 units, and a price of $30 per unit?

• A) 25 days
• B) 11 days
• C) 2.7 days
• D) 331 days

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Definitions:

Standard Deviations

A measure of the amount of variation or dispersion in a set of values, often used to quantify the spread of a probability distribution.

Observations

Observations refer to the act of watching or noticing something or the data collected during this process, usually as part of a study or experiment.

Crude Oil Prices

The cost per barrel of crude oil on the commodities market, which fluctuates due to various factors including supply and demand, geopolitical events, and market speculation.

Median Price

The middle value in a list of prices, where half the prices are higher and half are lower.