Question: A large distributor has 9 retail outlets. Currently each outlet manages its ordering independently. Demand at each retail outlet averages 2 0 0 0 per
A large distributor has retail outlets. Currently each outlet manages its ordering independently. Demand at each retail outlet averages per day. Assume there are days per year. Each unit of product costs dollars, and holding cost per unit of product per year is of the product cost. The fixed cost of each order administrative plus transportation is dollars in the decentralized system. The fixed cost of each order in the centralized system is twice of the decentralized system. Holding cost per unit are the same in the two systems.
How much does EACH warehouse need to order individually to minimize the total cost in the DECENTRALIZED system?
The potential answers are:
A: units.
B: units.
C: units.
D: units.
E: units.
How much should ALL the warehouses order together to minimize the total cost in the CENTRALIZED system?
The potential answers are:
A: units.
B: units.
C: units.
D: units.
E: units.
Compute the total ordering and carrying costs of ALL warehouses in the DECENTRALIZED system.
The potential answers are:
A: dollars.
B: dollars.
C: dollars.
D: dollars.
E: dollars.
Compute the total ordering and carrying costs of ALL warehouses in the CENTRALIZED system.
The potential answers are:
A: dollars.
B: dollars.
C: dol lars.
D: dollars.
E: dollars.
Compute the flow time in the DECENTRALIZED system. The potential answers are:
A: days.
B: days.
C: days.
D: days.
E: days.
Compute the flow time in the CENTRALIZED system.
The potential answers are:
A: days.
B: days.
C: days.
D: days.
E: days.
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