A Store Has Annual Average Daily Demand Rate of 16

question 10

Multiple Choice

A store has annual average daily demand rate of 16 units with a standard deviation of 2 units,and the time between orders is 90 days and the lead time for it to receive an order from its supplier is 20 days,if the supplier visits the store and there are 6 units of inventory in stock,the store's order size for a 95% service level is approximately

• A)3,268.6 units
• B)1,488.6 units
• C)1,788.6 units
• D)2,346.6 units

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Definitions:

Transportation Costs

Expenses incurred from moving goods, personnel, or materials from one location to another, which can impact a company's overall budget and pricing strategies.

Economic Conditions

The state of the economy at a certain time, characterized by factors such as GDP, unemployment rates, and inflation levels.

Open Market

A system where goods, services, and financial instruments are traded freely without restrictions, based on supply and demand forces.

Foreign Competitors

Companies based in one country that compete with those in another country, often affecting market share, pricing strategies, and innovation efforts.