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Table 511
the Following Information Has Been Collected on an Independent

Question 67

Multiple Choice

Table 5.11
The following information has been collected on an independent demand item:
Demand =30= 30 units per week (assume 52 weeks/ year)
Ordering and setup cost =$50= \$ 50 per order
Holding cost =$8= \$ 8 per unit per year
Lead time =1= 1 week
Standard deviation in weekly demand =8= 8 units
Cycle-service level =90%= 90 \%
You will need to refer to a normal table to answer the question(s) .
-Use the information from Table 5.11.Design a periodic review system (P system) ,with P = 5 weeks.What target inventory T will provide the desired 90 percent cycle-service level?


A) between 53 and 57 units
B) between 172 and 176 units
C) between 188 and 192 units
D) between 202 and 206 units

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