Answer:
Step-by-step explanation:
Given that:
The demand for number 6 screws is fairly constant and brother's hardware store sells 500 of these screws each day.
So;
The demand for number 6 screws = 500 screws /day
It takes approximately 8 working days for an order of number 6 screws to arrive once the order has been placed.
Delivery time-frame = 8 days
Lila believes that she can avoid stockouts completely if she only orders the number 6 screws at the correct time.
i.e Lila would want to have 8 days (delivery time-frame) × 500 screws /day
= 4000 screws
This implies that these 4000 screws will only last for 6 days.
Thus Lila ROP ( reorder point) will be to reorder for another set of screw the day she receives the current shipment, this implies that after 8 days she would have sold the present 4000 screws and she will be expecting a new re-stock.
