Lead time for one of your fastest-moving products is deterministic and equal to 21 days. Demand during this period is normally distributed. The average demand equals 100 units per day. What would be the reorder point under the (Q, R) policy with the required service level being 70%? A Less than 2100 units B Equal to 2100 units C More than 2100 units D We do not have enough information to decide
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Q: snip
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Lead time for one of your fastest-moving products is deterministic and equal to 21 days. Demand during this period is
A Less than 2100 units
B Equal to 2100 units
C More than 2100 units
D We do not have enough information to decide
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- The chapter presented various approaches for the control of inventory investment. Discuss three additional approaches not included that might involve supply chain managers.During the last 5 weeks, demands for a certain SKU at a retailer were 7 units (5 weeks ago), 4 units, 4 units, 4 units, and 5 units (last week). The retailer uses a period review model with order-up-to level 71 units, a review period of 2 weeks, and the lead time is 11 weeks. It is time to order. How much should the retailer order?Daily demand for product sample kits is normally distributed with a mean of 35 units and a standard deviation of 4. Supply is virtually certain with a lead time of 9 days. The cost of placing an order is $20, and annual carrying costs for one kit is 25 percent. The price of one kit is $12.50. Assume a year has 365 days.If a 99% service level is desired, what is average inventory on hand? If demand had no variation, what would the reorder point be?
- The Petroco Company uses a highly toxic chemical in one of its manufacturing processes. It must have the product delivered by special cargo trucks designed for safe shipment of chemicals. As such, ordering (and delivery) costs are relatively high, at $2,600 per order. The chemical product is packaged in 1-gallon plastic containers. The cost of holding the chemical in storage is $50 per gallon per year. The annual demand for the chemical, which is constant over time, is 2,000 gallons per year. The lead time from time of order placement until receipt is 10 days. The company operates 310 working days per year. Compute the optimal order quantity, the total minimum inventory cost, and the reorder point.18) The demand for an electronic component is normally distributed with an average daily demand of 500 units, and a standard deviation of 50. The lead time for the component is 9 days. If the company sets a reorder point of 4,650 for this component then its service level is approximately Group of answer choices 50 percent 92 percent 98 percent 84 percentABC Corporation resells one type of candle. It has 250 working days. Each day, it sells an average of 500 boxes but may sometimes sell a maximum of 600 boxes. The supplier takes an average of 5 days to deliver the order. During busier times, the supplier may take 7 days.Based on ABC’s records, ordering cost average P400 per order. Storage cost per box average P5 per year. There is also an opportunity cost of 1% per year for every peso invested in inventories. Each box of candles costs P450.If ABC would continue its current inventory management policy, it would keep 10,000 boxes as safety stock and order tendays-worth of inventory. (C) Reorder Point and Economic Order Quantity19. What would the average number of boxes be if the safety stock from Part A was kept and the EOQ from Part Bwas followed? Round off to two decimal places.20. How much would the carrying cost for the year be based on item 19?21. How much would the total inventory related (ordering plus carrying) costs be if the…
- ABC Corporation resells one type of candle. It has 250 working days. Each day, it sells an average of 500 boxes but may sometimes sell a maximum of 600 boxes. The supplier takes an average of 5 days to deliver the order. During busier times, the supplier may take 7 days. Based on ABC’s records, ordering cost average P400 per order. Storage cost per box average P5 per year. There is also an opportunity cost of 1% per year for every peso invested in inventories. Each box of candles costs P450. If ABC would continue its current inventory management policy, it would keep 10,000 boxes as safety stock and order ten-days-worth of inventory. (A) Reorder Point1. What should be the reorder point in boxes?2. How much would the normal lead time usage be?3. How much should ABC keep as safety stock?(B) Economic Order Quantity4. What is the annual demand for the boxes of candles?5. How much is the carrying cost of one box of candles for one year?6. What is the economic order quantity for the boxes of…ABC Corporation resells one type of candle. It has 250 working days. Each day, it sells an average of 500 boxes but may sometimes sell a maximum of 600 boxes. The supplier takes an average of 5 days to deliver the order. During busier times, the supplier may take 7 days. Based on ABC’s records, ordering cost average P400 per order. Storage cost per box average P5 per year. There is also an opportunity cost of 1% per year for every peso invested in inventories. Each box of candles costs P450. If ABC would continue its current inventory management policy, it would keep 10,000 boxes as safety stock and order tendays-worth of inventory. (A) Reorder Point 1. What should be the reorder point in boxes? 2. How much would the normal lead time usage be? 3. How much should ABC keep as safety stock? (B) Economic Order Quantity 4. What is the annual demand for the boxes of candles? 5. How much is the carrying cost of one box of candles for one year? 6. What is the economic order quantity for the…ABC Corporation resells one type of candle. It has 250 working days. Each day, it sells an average of 500 boxes but may sometimes sell a maximum of 600 boxes. The supplier takes an average of 5 days to deliver the order. During busier times, the supplier may take 7 days.Based on ABC’s records, ordering cost average P400 per order. Storage cost per box average P5 per year. There is also anopportunity cost of 1% per year for every peso invested in inventories. Each box of candles costs P450.If ABC would continue its current inventory management policy, it would keep 10,000 boxes as safety stock and order tendays-worth of inventory.(B) Economic Order Quantity9. What would the average number of boxes be if the economic order quantity was used (excluding safety stock)?Round off to two decimal places.10. How much would the carrying cost for the year if the economic order quantity was followed (excluding safetystock)?11. How much would the total inventory related (ordering plus carrying)…
- Daily demand for a product is 50 units, with a standard deviation of 35 units. The review period is 5 days and the lead time is 4 days. At the time of review, there are 60 units in stock. If 95 percent service probability is desired, how many units should be ordered?Apply the EOQ model to the following quantity discount situation in which D=500 units per year, C0=$40, and the annual holding cost rate is 20%. What order quantity do you recommend? Discount Category Order Size Discount (%) Unit Cost 1 0 to 99 0 $10 2 100 or more 3 $9.70H & K Electronic Warehouse sells a 12-pack of AAA batteries, and this is a very popular item. Demand for this is normally distributed, with an average of 50 packs per day and a standard deviation of 16. The average delivery time is 5 days, with a standard deviation of 2 days. Delivery time has been found to be normally distributed. A 96% service level is desired. What is the standard deviation of demand during the lead time? How much safety stock should be carried, and what should be the reorder point