Which of the following statements is best?
A) safety stock depends on the service level desired
B) safety stock depends on the length of the lead time
C) safety stock depends on the variation of demand during the lead time
D) all of the above are correct
E) none of the above is correct

Question

Quizplus · Accepted Answer

All of the options are correct. Safety stock is the stock kept in reserve to protect against stockouts due to unexpected events such as higher than expected demand or longer than expected lead times. The level of required safety stock depends on the desired service level, the length of the lead time, and the variation of demand during the lead time, and all these factors should be considered when calculating safety stock.

Which of the Following Statements Is Best