In the last subsection of Sec. 29.5, the (long-run) expected average cost per week (based on just ordering costs and unsatisfied demand costs) is calculated for the inventory example of Sec. 29.1. Suppose now that the ordering policy is changed to the following. Whenever the number of cameras on hand at the end of the week is 0 or 1, an order is placed that will bring this number up to 3. Otherwise, no order is placed. Recalculate the (long-run) expected average cost per week under this new inventory policy.
Answer to relevant QuestionsThe example in Sec. 2.1 summarizes an award-winning OR study done for Merrill Lynch. Read Selected Reference A2 that describes this study in detail. (a) Summarize the background that led to undertaking this study. (b) Quote ...Refer to pp. 163–167 of Selected Reference A4 that describes an OR study done for Yellow Freight System, Inc., and the resulting computer system SYSNET. (a) Briefly describe how the OR team gained the support of upper ...Consider the inventory example introduced in Sec. 29.1, but with the following change in the ordering policy. If the number of cameras on hand at the end of each week is 0 or 1, two additional cameras will be ordered. ...Reconsider Prob. 29.6-2. Now suppose that the manufacturer keeps a spare machine that only is used when the primary machine is being repaired. During a repair day, the spare machine has a probability of 0.1 of breaking down, ...Reconsider Prob. 29.2-2. Suppose now that whether or not the stock goes up tomorrow depends upon whether it increased today, yesterday, and the day before yesterday. Can this problem be formulated as a Markov chain? If so, ...
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