Question

For the data in problem 11:
In problem 11
Average annual sales = 600 tires
Ordering cost = $40 per order
Carrying cost = 25 percent per year
Item cost = $50 per tire
Lead time = 4 days
Standard deviation of daily demand = 1 tire
a. Calculate the annual turnover as a function of service level.
b. If sales were to increase by 50 percent, what would happen to the turnover at a 95 percent service level?


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  • CreatedSeptember 20, 2015
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