Question: Please show me the excel work with formulas: Lee Appliances knows that weekly demand for high-end microwaves is normally distributed, with a mean of 25

Please show me the excel work with formulas:

Please show me the excel work with formulas: Lee

Lee Appliances knows that weekly demand for high-end microwaves is normally distributed, with a mean of 25 units and a standard deviation of 7 units. (In your model use integers for all demand values). Lee replenishes its' inventory by ordering 300 units from the distributor whenever its' current inventory reaches 70 units. The Lead Time (in weeks) to receive an order from the distributor follows the distribution shown in the following table: Lead Time 1 2 3 Probability 0.15 0.25 0.30 0.15 0.10 0.10 4 5 6 The cost to hold 1 unit in inventory for 1 week is $20. The cost to place an order with the factory is $300. Stock out costs are estimated at $100 per unit. The initial starting inventory level is 140 units. Develop a simulation model to: (a) Simulate 52 weeks (one year) of the inventory system. Calculate the total annual costs (inventory costs + stock out costs + ordering costs). (b) Replicate the simulation model in (a) for 200 replications. Calculate the long-run average for total annual costs (inventory costs + stock out costs + ordering costs). (c) What is the expected total annual cost? (Hint: Set the Demand to the Mean in this case) (d) What recommended changes to the current inventory policy parameters (i.e., reorder- point and order quantity) would you use to reduce the chances of a Stock out

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!