A daily newspaper is stocked by a coffee shop so its patrons can purchase and read it while they drink coffee. The newspapercosts $1.17 per unit and sells for $1.75 per unit. If units are unsold at the end of the day, the supplier takes them back at arebate of $1 per unit. Assume that daily demand is approximately normally distributed with μ = 150 and a = 30.(a) What is your recommended daily order quantity for the coffee shop? (Round your answer to the nearest integer.)(b) What is the probability that the coffee shop will sell all the units it orders? (Round your answer to four decimal places.)(c) In problems such as these, why would the supplier offer a rebate as high as $1? For example, why not offer a nominalrebate? Find the recommended order quantity at 25¢ per unit. (Round your answer to the nearest integer.)What happens to the coffee shop's order quantity as the rebate is reduced?The higher rebate ---Select-- the quantity that the coffee shop should order.

Cost of newspaper (C) = $1.17Selling Price of newspaper (P) = $1.75Mean demand =150Standard…

Answered: A daily newspaper is stocked by a…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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HairGlow uses a chemical in the production of one of its hair products at a rate of 1,000 litres per year. The cost of placing an order and of receiving the chemical once it arrives in the warehouse is Ksh 30 and Ksh 70 respectively. The chemical is purchased at Ksh 20 per litre. Holding costs per year for a litre of the chemical is considered to be 15 percent of its cost. Find the length of an inventory cycle.
A gift shop sells 400 boxes of scented candles a year. The ordering cost is $50 for scented candles, and holding cost is $25 per box per year. What is the economic order size for scented candles?
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You are in charge of inventory control of a highly successful product retailed by your firm. Weekly demand for this item varies, with an average of 350 units and a standard deviation of 15 units. It is purchased from a wholesaler at a cost of $25.00 per unit. The supply lead time is 7 weeks. Placing an order costs $55.00, and the inventory carrying rate per year is 15 percent of the item's cost. Your firm operates 6 days per week, 50 weeks per year. Refer to the standard normal table The table below shows the total area under the normal curve for a point that is Z standard deviations to the right of the mean. Z 0.00 0.01 0.02 0.03 0.04 0.05 0.06 0.07 0.08 0.09 0.0 0.5000 0.5040 0.5080 0.5120 0.5160 0.5199 0.5239 0.5279 0.5319 0.5359 0.1 0.5398 0.5438 0.5478 0.5517 0.5557 0.5596 0.5636 0.5675 0.5714 0.5754 0.2 0.5793 0.5832 0.5871 0.5910 0.5948 0.5987 0.6026 0.6064 0.6103 0.6141…
HairGlow uses a chemical in the production of one of its hair products at a rate of 1,000 litres per year. The cost of placing an order and of receiving the chemical once it arrives in the warehouse is Ksh 30 and Ksh 70 respectively. The chemical is purchased at Ksh 20 per litre. Holding costs per year for a litre of the chemical is considered to be 15 percent of its cost. Find the average inventory cost per year
please answer within 30 minutes.
A retailer anticipates selling 5,400 units of its product at a uniform rate over the next year. Each time the retailer places an order for æ units, it charged a flat fee of $100. Carrying costs are $27 per unit per year. How many times should the retailer reorder each year and what should be the lot size to minimize inventory costs? What is the minimum inventory cost? Use the formula EOQ to obtain your answers. They should order units The minimum inventory cost is $ times a year.
I run a Ford car dealership, and I experience known and constant demand for cars. I sell 10,000 cars annually. The cost of ordering is $1,108, and the annual cost of holding a car on the lot is $500. What is the economic ordering quantity (EOQ)? Round to the nearest whole number (so if your answer is 443.363, round to 443)
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An engineer has decided to pursue ordering option for a particular item on an as needed basis as oppose to stocking it. To stock the item, inventory inspection costs $500 annually. The cost to place an order is estimated at $125. For the ordering option, there is an additional $85 special delivery charge per order. Demand for the $20 item is 2,300 units per year. The annual holding cost rate is 40% of the item price. Calculate range of the order quantity that will make it economical to order this item every time. If the engineer decides to stock the item what is the order quantity that is economical.
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