Organic milk is stocked at a grocery store each week. At the end of each week,...
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Organic milk is stocked at a grocery store each week. At the end of each week, unsold organic milk price is reduced by 25% and the store can sell the unsold organic milk fully at this lower price. If weekly demand for organic milk is normally distributed with a mean of 200 gallons and standard deviation of 20 gallons, find the price for which a fresh gallon of organic milk sells. Assume that the store has a service level of 95% and purchases organic milk for $6.1 per gallon. Bonus Problem: (6 points) (Bonus points will be added to your homework score). A fish distributor is trying to perfect his business to maximize the money he saves. Daily fish sales are normally distributed with a mean of 350 pounds and standard deviation of 60 pounds. The distributor sells each pound of fish for $6.00 and pays $2.50 per pound to buy fish. The distributor must get rid of unsold fish by paying a waste removal facility fee of $0.25 per pound of fish. How many pounds of fish should the distributor order each day and what % of the time will he experience a stock-out? Are there any drawbacks to the order size proposed and how could the fisherman address such issues? Organic milk is stocked at a grocery store each week. At the end of each week, unsold organic milk price is reduced by 25% and the store can sell the unsold organic milk fully at this lower price. If weekly demand for organic milk is normally distributed with a mean of 200 gallons and standard deviation of 20 gallons, find the price for which a fresh gallon of organic milk sells. Assume that the store has a service level of 95% and purchases organic milk for $6.1 per gallon. Bonus Problem: (6 points) (Bonus points will be added to your homework score). A fish distributor is trying to perfect his business to maximize the money he saves. Daily fish sales are normally distributed with a mean of 350 pounds and standard deviation of 60 pounds. The distributor sells each pound of fish for $6.00 and pays $2.50 per pound to buy fish. The distributor must get rid of unsold fish by paying a waste removal facility fee of $0.25 per pound of fish. How many pounds of fish should the distributor order each day and what % of the time will he experience a stock-out? Are there any drawbacks to the order size proposed and how could the fisherman address such issues?
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To find the price for which a fresh gallon of organic milk sells we can use the concept of service level and safety stock Given Mean demand 200 gallon... View the full answer
Related Book For
Operations Management Creating Value Along the Supply Chain
ISBN: 978-0470525906
7th Edition
Authors: Roberta S. Russell, Bernard W. Taylor
Posted Date:
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