You need to complete the model and run a simulation of the inventory system for ONLY 10 weeks. For this simulation you are to ALLOW FOR BACKORDERS (this means you need to allow for a negative ending inventory). If you have a negative ending inventory you will not have any carring cost but you will have a shortage cost. To compute the shortage cost multiple the number of units short by the per unit shortage cost of $50. For instance if your ending inventory is -3, the shortage cost would be $150. The beginning inventory of the next period should also be negative if the previous period had a shortage. The leadtime for shipments is a constant 2 weeks.

Answer the following questions for this 10 week simulation:   

Maximum Inventory during the 10 weeks ________

Total number of orders in the 10 weeks ________

Average weekly cost over the 10 weeks   _______________

Change the reorder point from 15 to 20. What is the average weekly inventory cost now? _______________

 

Reorder Order Order Carrying Shortage Point Quantity Cost/order Cost/unit Cost/unit 15 26 500 10 50 Mean Inventory Cost 200.00 Week Beginning Number Inventory 34 1 23456 O 7 8 9 10 LEADTIME = 2 weeks Order Inventory Random Receipt Number Level 34 0 0.01 0 0.20 0.90 0.80 0.95 0.47 0.67 0.90 0.41 0.19 Demand 14.0 Demand (x) Prob(x) 14.00 0.20 15.00 0.40 16.00 0.20 17.00 0.10 18.00 0.10 Ending Place Inventory Order 20.0 NO Cumulative Probability. 0.20 0.60 0.80 0.90 1.00 Order Cost 0.0 Carrying Cost 200.0 Vlookup model Cumlulative Prob 0.00 0.20 0.60 0.80 0.90 Shortage Cost 0.00 Demand 14.00 15.00 16.00 17.00 18.00 Total Cost 200.00 FOR n=10 Weeks Standard