1. A store has an ordering cost of $250, a carrying cost of $4 per unit, annual product demand of 6,000 units, and it purchases product from a supplier for $500 per unit, however, the supplier has offered the store a discount price of $400 if it will purchase 1,200 units; the store’s minimum total inventory cost is
a. $2,407,300
b. $3,607,200
c. $3,464,000
d. $2,987,400
2. If a store has annual demand (365 days per year) of 6,000 units and the lead time for it to receive an order from its supplier is 20 days, its EOQ reorder point is approximately
a. 300 units
b. 329 units
c. 428 units
d. 600 units
3. If a store has annual average daily demand of 16 units with a standard deviation of 2 units, and the lead time for it to receive an order from its supplier is 20 days, the store’s safety stock for a 95% service level is approximately
a. 14.8 units
b. 10.4 units
c. 17.5 units
d. 26.1 units
4. If a store has annual average daily demand of 16 units with a standard deviation of 2 units, and the lead time for it to receive an order from its supplier is 20 days, the store’s reorder point for a 95% service level is approximately
e. 326.1 units
f. 334.8 units
g. 348.2 units
h. 356.6 units