Question

Assuming no safety stock, what is the reorder point (R) given an average daily demand of 50 units, a lead time of 10 days, and 625 units on hand?

a. 550
b. 500
c. 715
d. 450
e. 475

Answer 1

Answer:

b. 500

Explanation:

Calculation for the what is the reorder point

Using this formula

Reorder point = d*L

where,

d represent average daily demand = 50

L represent Lead Time = 10 days

Let plug in the formula

Reorder Point = 50*10 = 500

Therefore Reorder Point will be 500