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Business, 05.05.2020 18:25 samantha636
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 fiveâday leadâtime. 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.
What is the reorder point R to satisfy a 98% cycleminusâservicelevel?
A. greater than 1,700 units
B. greater than 1,600 units but less than or equal to 1,700 units
C. greater than 1,500 units but less than or equal to 1,600 units
D. less than or equal to 1,500 units
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Answers: 2
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