Question: Given the following information : 1 . The demand during the lead time follows a normal distribution N ( 2 5 2 , 1 0

Given the following information :1. The demand during the lead time follows a normal distribution N(252,100).2. The probability of exceeding262 units is about 16 percent.3. The holding cost per unit per year is $7.8.4. The average annual demand is 2835 units.5. The EOQ is approximately 142 parts.6. The annual inventory cost at the EOQ is approximately $1051.50.7. The order frequency at theEOQ is approximately 20 times per year.8. The unit ratio is approximately 1.9.
Please find the following:
1. Using your anwer to number 8, what is the cost coefficient ratio of ordering yQ*=270 units instead of Q* units?
a.1.25 b.2.75 c.4.5 d.3.5
2. Using your answer to the questions 3-5, what is the per-unit cost of a surplus, C+?
a. $0.52 b. $0.19 c. $0.81 d. $0.37
3. Using the average unit cost c and revenue r along with your answer to the above question, what is the optimal service level, SL*?
a.0.9537 b.0.9225 c.0.9759 d.0.9488
4. Considering the above question, what is the safety stock required per order at the optimal service level?
a.18 parts b.16 parts c.20 parts d.14 parts
5. Suppose we relaxed the service level requirement to only 0.9192. What is the safety stock required per order at this service level?
a.14 parts b.18 parts c.16 parts d.20 parts

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