Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Question: The purchasing agent for a company that assembles and sells air-
conditioning equipment in a Latin American country noted that the cost of
compressors has increased significantly each time they have been reordered. The
company uses an EOQ model to determine order size. What are the implications of
this price escalation with respect to order size? What factors other than price must
be taken into consideration?
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- question #3 Same problem statement: Weekly demand for DVD-Rs at a retailer is normally distributed with a mean of 1,000 boxes and a standard deviation of 150. Currently, the store places orders to the supplier, with a reorder point of 4,200 boxes. The order quantity to the supplier is fixed at 5,000 boxes. Replenishment lead time is 4 weeks, fixed order cost per order is $100, each box costs the retailer $10, and the inventory holding cost is 25% per year. With a safety stock of 300 boxes, what is the approximate service level (round to two decimals)? Numeric Response 84.13 * f5 10 f6 0 4- ♫+ fg C fil W f12. insert prt sc + 11 Ə ← delete backspace home num lock 4x D end 1:23 PM 11/15/2022 pg uparrow_forwardWhile break-even pricing is relatively simple, markup pricing uses more complicated concepts of cost. Question 49 options: True Falsearrow_forwardQUESTION 1 Which of the following statements regarding foreast sharing game is INCORRECT? Retailer only faces underage risk. Supplier faces both underage and overage risks. Suppliers tend to produce less than the supply chain optimal quantity. The retailer has to purchase at least the quantity it reports to the supplier. QUESTION 2 Assume that the firm can source from 2 faraway suppliers (each has Lead time = 4 months, capacity=60 k) and 2 Closeby suppliers (each Lead time =0 month, capacity=40k). The sales season starts in May. Which of the following statements regarding sourcing is INCORRECT? The production change should be only applied to the Closeby supplier so that the firm can benefit from the change in time. The production at the Faraway supplier should start in January and the production at Close-by supplier should start in May. The firm should source from a combination of one faraway supplier and one close-by…arrow_forward
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- 8arrow_forwardQUESTION 13 The return to any factor of production that is in variable demand variable supply fixed demand fixed supply is pure rent.arrow_forwardWhen customers try to pit suppliers against each other to drive down the price, the salesperson should offer an initial discount and raise the price later on. Question 13 options: True Falsearrow_forward
- In _____,the seller pays all or part of the actual freight charges and does not pass them on to the buyer. Question 47 options: a) uniform delivered pricing b) basing-point pricing c) freight absorption pricing d) free on board origin pricingarrow_forwardQuestion content area Part 1 A gourmet coffee shop in downtown San Francisco is open 200 days a year and sells an average of 75 pounds of Kona coffee beans a day. (Demand can be assumed to be distributed normally with a standard deviation of 16 pounds per day). After ordering (fixed cost = $17 per order), beans are always delivered from Hawaii in exactly 4 days. Per-pound annual holding costs for the beans are $3. Refer to the standard normal table LOADING... for z-values. e) What is the safety stock needed to attain a 1% risk of stockout during lead time? enter your response here pounds (round your response to two decimal places). Part 7 f) What is the annual holding cost of maintaining the level of safety stock needed to support a 1% risk? $enter your response here (round your response to two decimal places). Part 8 g) If management specified that a 2% risk of stockout during lead time would be acceptable, the safety stock holding costs will ▼…arrow_forward
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