A Company Has Recorded the Last Five Days of Daily

question 45

Multiple Choice

A company has recorded the last five days of daily demand on its only product. Those values are 120, 125, 124, 128, and 133. The time from when an order is placed to when it arrives at the company from its vendor is 5 days. Assuming the basic fixed-order-quantity inventory model fits this situation and no safety stock is needed, which of the following is the reorder point (R) ?

• A) 120
• B) 126
• C) 630
• D) 950
• E) 1,200

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Definitions:

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