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The annual demand for inventory item P-2001 is 6000. Order lead time is 6 workdays, and the firm's "year" is 300 days (6 workdays weekly, times 50 weeks). Empirical analysis indicates that the daily variance of P-2001 demand is 20 units. Suppose Q* = 400. Now if the firm is willing to be out of stock of P-2001, an average of no more than two inventory cycles per year, what should be the reorder point (rounded to the nearest integer)?
a. 107
b. 132
c. 150
d. 174
e. None of the above
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