Consider the following single-period inventory model (probabilistic demand). The Smith shoecompany is currently selling an athletic shoe for the spring and summer months. It does notexpect to sell any shoes in the fall, thus it will not sell after July 31. The shoes cost Smith $110per pair and Smith will sell them retail at a price of $140. During the August sale, the shoes willsell for $70 a pair. The demand for shoes is assumed to be uniformly distributed with the rangeof demand going from 2,000 pairs to 3,800 pairs.Answer these questionsQuestion 7. What is the value of co?(b)(a)Question 8. What is the value of cu?

Given data; Cost price 110 $ per pair Selling price 140 $ per pair Salvage price 70 $ per…

Answered: Consider the following single-period…

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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Rex manufacturing purchases a printed circuit board for use in its automatic, computerized, robotbartender. The manufacturing facility has placed the following monthly demands on purchasedgoods inventory during the past year. Month 1 2 3 4 5 6 7 8 9 10 11 12 Demand 205 193 197 220 202 226 179 197 186 202 179 214 This demand schedule can be assumed to be random, to follow a normal distribution, and to berepresentative of what will occur in the future. Rex estimates that a fixed cost of $300 isincurred each time an order is placed for the boards, and that the inventory holding cost is about20% per year of the value of inventory. Each board has an estimated value of $192 at the pointof storage. The lead time on purchase orders is (1/5) month.Part A: What is the EOQ?Part B: What is the safety stock required to assure the management that the chance of a stock outin a cycle is no more than 1%?Part C: What is the reorder level?
A firm orders apparels from a distant country and can order only once for the entire season. This ordering follows the assumption of the newsvendor model. The firm forecasts that their average demand is likely to be 8500 units. The firm believes that the possible variation in demand is normally distributed and the standard deviation is 650 units. If the apparel cost is $3, the selling price is $25 and the scrap value is zero, what is the ideal order quantity for this apparel?
Suppose the monthly demand for automobile tires at a tire dealer is Normally distributed with a mean of 250 tires and a standard deviation of 50 tires. How many tires must the store have in inventory at the beginning of each month to meet the demand 95% of the time?
Inventory can be very expensive for firms to hold and manage. One measure of how effective a firm is at managing their inventory is the inventory sales ratio (inventory/sales). Assume a firm has quarterly sales of 1 million and inventory is normally distributed with a mean of $500k and a standard deviation of $100k. simulate the expected inventory to sales ratio for 10,000 iterations. What is the expected mean inventory to sales ratio? What is the probability that the inventory sales ratio is less than 0.5?
Consider a toy retailer with warehouses in St. Louis and Kansas City, Missouri. The warehouses stock an identical popular toy delivered to stores in the two cities. Assume a warehouse serves only stores in its city. Weekly demand for St. Louis is normally distributed with mean 2,000, and standard deviation 400 (that is N(μ = 2,000, σ = 400)). Weekly demand for KansasCity is distributed N(μ = 2,000, σ = 300). We assume that the two cities are far enough apart so that demand in the two cities is independent.The following parameters are seen by both warehouses:Replenishment lead time in weeks ~ N(μ = 2, σ = 0.1);Fixed shipping cost of replenishment: $500;Cost per toy: $10; andHolding cost per toy 20 percent of toy’s value per year.How many toys should each location order at a time and when should they reorder if they want a 99 percent cycle service level? What if they pool the two locations?
Problem 4 In a known company, the demand for a product follows a normal distribution. Based on past data, you calculated a weekly average of 30 units with a standard deviation of 7 units. The supplier can deliver each unit and takes 5 weeks at a cost per unit of $25. The supplier lead time has a standard deviation of 1 week. Every time you place an order to the supplier will cost $45, and the inventory holding cost is $2.00 per unit per year. No stockouts are allowed because there is a cost of $2,000 Istockout. The company operates 45 weeks per year. What is the economic order quantity? а. b. What is the optimal reorder point and the safety stock at a service level of 95%?
Can you assist me with Question 12. Please show the steps it's easier to follow along instead of an excel spreadsheet. Thank you
Please do. Fast ASAP
Good Shoes Company manufactures ski boots for children each pair of which costs $40 to manufacture. Good Shoes sells the boots to a well-known sports goods retailer and the retailer sells each pair for $100. Any boots not sold (by the retailer) during the season are sold to a discount retailer for $20 a pair. Demand during the season is assumed to have a Normal distribution with a mean of 850 and a standard deviation of 350. What should the manufacturer charge the retailer per pair to maximize its expected profits? Assume that Good Shoes will consider a price from the following set: (60,65,70,75,80,85 90,95), i.e., The manufacturer's price will be either $60, or $65 or $70, or ......,,$95).
Please help to solve step by step
How is probability is used in inventory management?
An online retailer sells 1,500 t-shirts per year. The cost of the t-shirts to the store is $3.00 and the cost of placing an order is $15 per order. It cost $0.60 per t-shirt per year for the retailer to hold the t-shirts. The retailer sells the t-shirts for $9.99. Determine (a) the optimal order quantity, (b) the order frequency (c) the annual holding and setup cost.

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