For a particular component, the re-order quantity is 6,000 units and the average inventory holding is 3,400 units.
What is the level of safety inventory (in whole units)?
________ units
The correct answer is: 400 units
The level of safety inventory is 400 units (to the nearest whole unit).
Let x = safety inventory
Average inventory
3,000
x
3,400 - 3,000
400 units
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