Scenario 9.5 Cranium,Inc. ,Purchases Term Papers from an Overseas Supplier Under a Under

question 215

Multiple Choice

Scenario 9.5
Cranium,Inc. ,purchases term papers from an overseas supplier under a continuous review system.The average demand for a popular mode is 300 units a day with a standard deviation of 30 units a day.It costs $60 to process each order and there is a five-day lead-time.The holding cost for a paper is $0.25 per year and the company policy is to maintain a 98% service level.Cranium operates 200 days per year.A normal distribution table is appended to this exam.
-Use the information in Scenario 9.5.If lead-time increases by three days,what is the reorder point needed to maintain a 98% service level?

• A)less than or equal to 2,400 units
• B)greater than 2,400 units but less than 2,500 units
• C)greater than 2,500 units but less than 2,600 units
• D)greater than 2,600 units

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The act of looking for employment, through various means such as online job boards, networking, or direct applications.

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An individual or organization that hires and pays people to work for them.

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