Multiple choice

Directions: Choose the correct option for the given question.

Minimum stock level = Reorder level - ______ x Normal delivery time

  1. Reorder level

  2. Reorder period

  3. Normal consumption

  4. Minimum consumption

  5. None of these

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

The formula for minimum stock level is: Reorder level - (Normal consumption x Normal delivery time). This accounts for the buffer needed during the lead time.