Question

If the lead time is 1 week, the review period 1 week, the average demand 100 units per week and the safety stock is 50 units, the target level will be:

A) 150 units.
B) 300 units.
C) 250 units.
D) 200 units.
E) none of the above

Answer 1

The target level is 150 units.

Step-by-step explanation:

The target level can be calculated by adding the average demand during the lead time and the safety stock. In this case, the average demand is 100 units per week and the lead time is 1 week, so the average demand during the lead time is 100 units. Adding the safety stock of 50 units, the target level would be 150 units.

Therefore, the correct answer is: A) 150 units.