A container liner company do not want to be in a stockout situation because of the non-availability of the container type that the customer wants. They count their inventory on hand and create the below table:

Container Type	Capacity
	20”	40”
Standard	3	3
Reefer	2	2
Open Top	1	1

Daily demand for container changed according to below table:

Container TEU	Probability
3	8%
4	7%
5	20%
6	26%
7	24%
10	15%

Demand for 20” container probability is 45%, and also you can find container type demand probabilities below:

Container Type	Demand
	20”	40”
Standard	30%	50%
Reefer	30%	20%
Open Top	40%	30%

Simulate the system for 10 days. The company believes that the stockout rate cannot be more than 5%. In your opinion, if the company decides to purchase new containers which type of container must they buy and how many units?

Answer rating: 100% (QA)

There are three possible scenarios 1 The company buys 3 standard containers and 2 reefer containers ... View the full answer