Scenario 9.13 Demand = 100,000 Units/year

question 61

Multiple Choice

Scenario 9.13
Demand = 100,000 units/year
Number of days per year = 250 weeks
Standard deviation of weekly demand = 50 units
Average lead time = 5 days
Standard deviation of lead time: 2 days
Cycle-service level = 99%
A continuous review system is used to control inventory.
A normal distribution table is appended to this exam.
-Use the information in Scenario 9.13.What reorder point should the firm use for this product?

• A)greater than 4,500 units
• B)greater than 3,500 units but less than or equal to 4,500 units
• C)greater than 2,500 units but less than or equal to 3,500 units
• D)greater than 1,500 units but less than or equal to 2,500 units
• E)greater than 0 but less than or equal to 1,500 units

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Definitions:

Account Penetration

A measure of the depth of sales or services provided to a specific customer, often aimed at increasing the share of the customer's purchasing.

Maximizing Sales

The process of increasing the amount or value of products or services sold, often by employing strategies and techniques to attract more customers or by enhancing the effectiveness of sales efforts.

Transaction Selling

A sales approach focused on single, one-time sales transactions rather than developing long-term customer relationships.

Customer Needs

Customer needs encompass the desires, expectations, or requirements that customers have regarding a product or service to solve a problem or fulfill a desire.