Mr Dave Jones manages the warehouse inventory for Athleticks, a distributor of sports watches. From his experience, Mr. Jones knows that the PR-5 jogging watch has an average daily demand of 100 units and a performance cycle of 8 days. Mr. Jones requires no buffer stock at this time.
a. Assume Mr.Jones perpetually review inventory levels. Find the reorder point for the PR-5 jogging watch.
b. Find the average inventory level of the PR-5 watch.
c. How might the reorder point change if Mr.Jones reviews inventory once each week? Find the reorder point under these conditions.
d. Find the average inventory level of the PR-5 watch under this periodic review.