What is the formula for calculating the maximum inventory level?
A) Imax = H(1-d/p)
B) Imax = Q(1-d/p)
C) Imin = Q(1-s/p)
D) Imax = Q(1-d/s)
E) Imin = Q(1-d/h)

Question

Quizplus · Accepted Answer

The maximum inventory level formula is Imax = Q(1-d/p), where Q is the quantity ordered, d is the demand rate, and p is the production rate. This formula helps in determining the highest level of inventory that can be maintained before needing to reorder.

What Is the Formula for Calculating the Maximum Inventory Level