If average demand for an item is 20 units per day,safety stock is 50 units,and lead time is four days,the reorder point (ROP)will be:
A)50
B)70
C)130
D)170
E)220

Question

Quizplus · Accepted Answer

The formula for calculating ROP is:

ROP = (Average Daily Demand x Lead Time) + Safety Stock

Substituting in the given values:

ROP = (20 x 4) + 50

ROP = 130

Therefore, the best choice is option C, with an ROP of 130 units.

If Average Demand for an Item Is 20 Units Per