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When demand and delivery lead time are known and constant, daily demand = 8, purchase lead time = 5 days, and the purchase price = $20/unit, then the reorder point is: a. 32. b. 13. c. 2. d. 40. e. 56.

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abiolataiwo2015

Based on the information given the reorder point is :d. 40.

Reorder point

Using this formula

Reorder point = Daily demand×Purchase lead time

Where:

Daily demand=8

Purchase lead time =5 days

Let plug in the formula

Reorder point=8×5 days

Reorder point=40

Inconclusion the reorder point is :d. 40.

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