Question: Demand per Week Probability Cumulative probability Random number mapping 0 0.05 0.05 00-04 1 0.10 0.15 05-14 2 0.20 0.35 15-34 3 0.35 0.70 35-69

Demand per Week Probability Cumulative probability Random number mapping
0 0.05 0.05 00-04
1 0.10 0.15 05-14
2 0.20 0.35 15-34
3 0.35 0.70 35-69
4 0.20 0.90 70-89
5 0.05 0.95 90-94
6 0.05 1.00 95-99

CWD Office Supplies sells Printers, which it orders from Kajama Inc in Japan. Because of shipping and handling costs, each order must be for 5 printers. Because of the time it takes to receive an order, the company places an order every time the present stock drops to 5 Printers. It costs $50 to place an order. It costs the company $500 in lost sales when a customer asks for a Printer and the warehouse is out of stock. It costs $100 to keep each Printer stored in the warehouse. If a customer cannot purchase a Printer when it is requested, the customer will not wait until one comes in but will go to a competitor.The following probability distribution for demand for Printer has been determined:

Lead Time:

Time to Receive an Order (wk)

Probability

Cumulative Probability Random Number Mapping
1 0.60 0.60 00-59
2 0.20 0.80 60-79
3 0.20 1.00 80-99

Complete the following Simulation of CWD's Ordering and Sales Policy for 20 Weeks

Demand .15 .84 .16 .12 .55 .16 .84 .63 .33 .57 .18 .26 .23 .52 .37 .70 .56 .99 .16 .31
Lead time .47 .74 .35 .56 .64 .21 .55 .01 .40

Month OI U R A I RN D D F EI SO order RN lead-time IC SOC OC TC
1 3 0.15
2 0.84
3 0.16
4 0.12
5 0.55
6 0.16
7 0.84
8 0.63
9 0.33
10 0.57
11 0.18
12 0.26
13 0.23
14 0.52
15 0.37
16 0.70
17 0.56
18 0.99
19 0.16
20 0.31

  1. Complete CDWs ordering and sales policy for 20 weeks
  2. Compute the average cost of the policy

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!