Scenario 9.11
The Hastings Company is a nation-wide wholesaler for small electronic devices.One of its most popular items is a calculator,the "Whizz-Bang 1100".Hastings's demand,lead time and cycle service requirements for the W-B 1100 are as follows:
Demand = 25,000 units/year
Number of weeks per year = 50 weeks
Standard deviation of weekly demand = 100 units
Average lead time = 6 weeks
Standard deviation of lead time: 2 weeks
Cycle-service level = 85%
Hastings uses a continuous review system to control inventory.
A normal distribution table is appended to this exam.
-Use the information in Scenario 9.11.What reorder point should Hastings use for the Whizz-Bang 1100?
A) greater than 0 but less than or equal to 1,200 units
B) greater than 1,200 units but less than or equal to 2,400 units
C) greater than 2,400 units but less than or equal to 3,600 units
D) greater than 3,600 units but less than or equal to 4,800 units
E) greater than 4,800 units
Correct Answer:
Verified
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