Which of the following statements regarding the reorder point is true? A) The reorder point is that quantity that triggers an action to restock an item. B) There is a reorder point even if lead time and demand during lead time are constant. C) The reorder point is larger than d x L if safety stock is present. D) The fixed-period model has no reorder point. E) All of the above are true.

Question

Quizplus · Accepted Answer

- A) Correct because the reorder point is indeed the specific inventory level at which an order is placed to replenish stock.- B) Correct because even with constant lead time and demand, a reorder point is necessary to ensure stock is replenished before it runs out.- C) Correct because the reorder point formula is $d \times L + \text{Safety Stock}$, where $d$ is the demand rate and $L$ is the lead time. The presence of safety stock increases the reorder point beyond just $d \times L$.- D) Correct because the fixed-period model operates on a set time interval for ordering rather than inventory levels reaching a specific point, thus it does not use a reorder point in the traditional sense.

Which of the Following Statements Regarding the Reorder Point Is