Assignment:
The annual demand for a popular drug is 10,000 bottles. The purchase price of this drug (from the manufacturer) is $55. The retailer incurs $20 every time he places an order. It will cost annually a 8% of the purchase price to carry the inventory. Assume 52 weeks per year. Each order is received from the manufacturer in a single delivery.
- What is the reorder point if the lead time is 2 days?
- In addition to LL = 2 days, if a safety stock of 20 units is needed, what is the reorder point?
Your answer must be typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.