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Average stock level required to maintain the inventory is calculated as

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Remember the two standard expressions for Average Stock Level: 1. $\text{Minimum Level} + \frac{1}{2}(\text{Reorder Quantity})$ 2. $\frac{\text{Minimum Level} + \text{Maximum Level}}{2}$ This makes it simple to spot the correct structure on a test.

Updated On: Jul 9, 2026

Minimum stock level + half of the reorder cost
Maximum stock level + half of the reorder cost
Minimum stock level + one fourth of the reorder cost
Maximum stock level + one fourth of the reorder cost

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The Correct Option is A

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Average stock level required to maintain the inventory is calculated as

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The Correct Option is A

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