Table $5.4$ A Company Operating Under a Continuous Review System Has an Has

question 18

Multiple Choice

Table $5.4$
A company operating under a continuous review system has an average demand of 50 units per week for the item it produces. The standard deviation in weekly demand is 20 units. The lead time for the item is 6 weeks, and it costs the company $\$ 30$ to process each order. The holding cost for each unit is $\$ 10$ per year. The company operates 52 weeks per year. You will need to refer to a normal table to answer the question(s) .
-Use the information in Table 5.4. What is the economic order quantity (EOQ) for this item?

• A) less than or equal to 175 units
• B) greater than 175 units but less than or equal to 200 units
• C) greater than 200 units but less than or equal to 225 units
• D) greater than 225 units

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Definitions:

Inexpensive

Referring to a product, service, or item that has a low cost or price, making it affordable to a wide range of consumers.

Set-point Control

A control system method where a device adjusts its operation to maintain a process variable at a desired set-point or value.

Open Loop Control

A control system where the control action is independent of the output, lacking feedback from the process being controlled.

FLL Instruction

An instruction in PLC programming that fills a block of data with a specified value.