Exhibit 12.3 The Following Questions Use the Information Below

question 71

Multiple Choice

Exhibit 12.3
The following questions use the information below.
An auto parts store wants to simulate its inventory system for engine oil. The company has collected data on the shipping time for oil and the daily demand for cases of oil. A case of oil generates a $10 profit. Customers can buy oil at any auto parts store so there are no backorders (the company loses the sale and profit) . The company orders 30 cases whenever the inventory position falls below the reorder point of 15 cases. Orders are placed at the beginning of the day and delivered at the beginning of the day so the oil is available on the arrival day. An average service level of 99% is desired. The following spreadsheets have been developed for this problem. The company has simulated 2 weeks of operation for their inventory system. The current level of on-hand inventory is 25 units and no orders are pending.
-Using the information in Exhibit 12.3, what formula should go in cell C9 and copied to C10:C21 of the MODEL sheet to compute units received?

• A) =COUNT($J$8:J8,A9)*$D$4
• B) =COUNTIF($J$8:J8,A8)*$C$4
• C) =COUNTIF($J$8:J8,A9)*$D$5
• D) =COUNTIF($J$8:J8,A9)*$D$4

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Definitions:

Dichotomous

Relating to or involving a division or contrast between two completely opposed or different things.

Dependent Variables

Variables in research that are expected to change as a result of an experiment's independent variable manipulation.

Test Markets

Regional markets or demographic groups used for launching new products to evaluate consumer response before a national rollout.

Competitors

Businesses or individuals that compete within the same market for resources and customers.