If Average Demand for an Inventory Item Is 200 Units

question 78

Multiple Choice

If average demand for an inventory item is 200 units per day, lead time is three days, and safety stock is 100 units, the reorder point is

• A)100 units.
• B)200 units.
• C)300 units.
• D)600 units.
• E)700 units.

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Definitions:

Interest Rates

The percentage rate of a loan that is charged as interest to the borrower, routinely represented as an annual percentage of the outstanding loan principal.

New Shares

Shares that are issued by a company for the first time to the public, typically through an initial public offering (IPO) to raise capital.

Indirectly Borrowing

Obtaining funds through an intermediary, such as by taking out a loan through a bank, rather than directly from a lender.

Bonds

Bonds are fixed-income securities that represent a loan made by an investor to a borrower, typically corporate or governmental, which pays periodic interest payments and repays the principal at maturity.