Question: These are all under one problem, thank you Question 1 Answer saved Points out of 1.00 A gourmet coffee shop in downtown SF is open





These are all under one problem, thank you
Question 1 Answer saved Points out of 1.00 A gourmet coffee shop in downtown SF is open 200 days a year and sells an average of 75 pounds of Colombian Coffee beans a day. Demand can be assumed to be distributed normally with a standard deviation of 15 pounds/day. Ordering cost is $16 per order, beans are always shipped by air within exactly 4 days. Per-pound annual holding costs for the beans are $3. (1) What is the economic order quantity (EOQ) for Colombian coffee beans? Round to the nearest integer if necessary. P Flag question Answer: (3) Assume that management has specified that no more than a 1% risk during stock out is acceptable. What should our reorder point (ROP) be? Keep one decimal place if necessary. Answer: 369.9 (4) Suppose the coffee shop decided to reorder the coffee beans when there are 63 pounds left in stock. The stockout risk implied by this reorder point is %. Keep one decimal place if necessary (5) If management specified that a 2% risk of stock-out during lead time would be acceptable, would our safety stock holding costs decrease or increase? Select one: O a decrease O b. increase
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