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Annual demand for an item is 6,500 units with the cost per unit at $380. The inventory holding rate is 18% and the ordering cost is $15.00 per order. The standard deviation of daily demand is 7 units. Assume 261 days in the year and a lead-time of 4 days. If a service level of 96% is desired during the reorder interval, what is the reorder point? (Note: Due to rounding and your exact choice of z, your answer may be a few units off the choices given.)

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M93109112

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