Multiple choice

If the minimum stock level and average stock of raw material A are 5,000 and 8,000 units respectively, find the reorder quantity.

  1. 5,000 units

  2. 6,000 units

  3. 6,500 units

  4. 5,500 units

Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

 It is 6000 units. Average Stock Level - Minimum Stock Level  + 1/2 Reorder Quantity   8000 units  =5000 units +  1/2 Reorder Quantity   1/2 Reorder Quantity =  8000 units - 5000 units = 3000 units    1/2 Reorder Quantity =  3000 units   So Reorder Quantity = 3000 units X 2 / 1 = 6000 units

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