Homework 3: Inventory Management (Ch 13) Started: Aug 1 at 7:33am Quiz Instructi
ID: 434619 • Letter: H
Question
Homework 3: Inventory Management (Ch 13) Started: Aug 1 at 7:33am Quiz Instructions Solve the following problems and select the best answer in each. DQuestion 1 10 pts GROCERY STORE PROBLEM: A local grocery store faces demand for one of its items at a constant rate of 20,000 boxes per year. It costs them $5 to process an order and $0.50 per box per year to carry the item in stock. The stock is received three working days after an order is placed. Assume 250 working days in a year and no backordering. What is the demand during lead time assuming that there is no variability? 600 O 240 O 320 O 80Explanation / Answer
1.
Annual Demand,D= 20,000
Lead Time,L= 3 days
Number of working days= 250
Demand during lead time= Lead time * Demand/Forecasted Time
= 3* (20,000/250)
=240
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