Scenario 9.11 Demand = 50,000 Units/week

Multiple Choice

Scenario 9.11
Demand = 50,000 units/week
Standard deviation of weekly demand = 15,000 units
Average lead time = 8 weeks
Standard deviation of lead time: 3 weeks
Cycle-service level = 80%
A continuous review system is used to control inventory.
-Use the information in Scenario 9.11. What safety stock should the firm use for this product?

A) greater than 0 but less than or equal to 50,000 units
B) greater than 50,000 units but less than or equal to 100,000 units
C) greater than 100,000 units but less than or equal to 150,000 units
D) greater than 150,000 units but less than or equal to 200,000 units
E) greater than 200,000 units