If both demand and lead time are constant,then to determine the inventory level at which to reorder,we need to know ______.
A)the average demand rate and the lead time
B)the average demand rate and the purchase price
C)the purchase price and the safety stock
D)the safety stock and the lead time

Question

Quizplus · Accepted Answer

The inventory level at which to reorder depends on the average demand rate and the lead time, assuming both are constant. To ensure that the inventory level does not run out of stock during the lead time, a safety stock should also be considered. However, this is not included in the options, and the question only asks for the essential factors to determine the reorder inventory level. The purchase price is not relevant to determining the inventory level at which to reorder.

If Both Demand and Lead Time Are Constant,then to Determine