Operations and Supply Chain Management 14th Edition by Robert Jacobs,Richard Chase

Exercise 8

We have an item that we stock in our store that has fairly steady demand. Our supplier insists that we buy 1,200 units at a time. The lead time is very short on the item, since the supplier is only a few blocks away and we can pick up another 1,200 units when we run out. How many units do you expect to have in inventory on average?