Ruby Owns a Small Café and Uses a Linen Supplier

question 126

Multiple Choice

Ruby owns a small café and uses a linen supplier for her tablecloths. Whenever she needs more tablecloths, she calls the supplier. She uses an average of 12 tablecloths a day with a standard deviation of 3 tablecloths. Lead time is a constant 2 days. If Ruby is willing to accept a 5% stockout risk, what is the reorder point, rounded to the nearest tablecloth? Assume demand is normally distributed.

• A) 28
• B) 31
• C) 34
• D) 42

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Definitions:

Department of Justice

A federal executive department of the U.S. government responsible for the enforcement of the law and administration of justice.

Per Se Violations

Actions that are considered inherently illegal under antitrust laws, without needing to prove their harm on competition.

Business Practices

Established methods of conducting business, which can include strategies, ethics, policies, and procedures.

Sherman Act

A foundational antitrust law in the United States that prohibits monopolies and other activities that restrict competition in the marketplace.