Question

Re-ordering level $=$ Maximum consumption $\times$ __________.

• A. Average re-order period
• B. Maximum usage
• C. Maximum re-order period
• D. Normal usage

Answer 1

The correct option is C Maximum re-order period

Reorder level of inventory is that level at which company should place a new order.

This can be calculated by keeping the maximum consumption and the lead time in mind.