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Solution Library
Measuring Various Inventory Levels and Order Quantities
Question
Consider the following data pertaining to a distribution center.
Mean Weekly Demand 100
Standard Deviation of Weekly Demand 30
Lead Time 2 Weeks
# of weeks in year 50
Ordering cost: $50 /order
Holding cost: $4 /unit /week.
Cycle service level: 97%
You have to measure order quantity, cycle inventory, safety inventory, reorder level, annual inventory holding cost, number of orders per year, annual ordering cost
Summary
The question belongs to Operations Management and it deals with measuring inventory levels, order quantities, etc. With measures such as mean weekly demand, standard deviation and lead time, various inventory levels have been calculated.
Total Word Count 213
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