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Business Arithmetic — Entrepreneurship STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEntrepreneurshipBusiness Arithmetic3 Marks
Question
Give the formula for computing the level at which fresh order should be placed. What is this level referred to as?
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Answer

This level is referred to as 'Re-order level'.
It is cumputed with the help of following formula:
Re-order Level = Maximum Rate of Consumption (MRC) × Maximum Re-order Period.

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