Practical Management Science
6th Edition
ISBN: 9781337406659
Author: WINSTON, Wayne L.
Publisher: Cengage,
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Transcribed Image Text:The stationary shop estimates that the average demand for a popular ball-point pen is 12,000
pens per week with a standard deviation of 3,000 pens. The current inventory policy calls for
replenishment orders of 156,000 pens. The average lead time from the distributor is 5 weeks,
with a standard deviation of 2 weeks. If management wants a 98 percent cycle-service level,
what should the safety stock be?
41,118 pens
51,806 pens
101,118 pens
51,086 pens
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- Regional Supermarket is open 360 days per year. Daily use of cash register tape averages 10 rolls. Usage appears normally distributed with a standard deviation of 2 rolls per day. The cost of order-ing tape is $1, and carrying costs are 40 cents per roll a year. Lead time is three days. a. What is the EOQ?b. What ROP will provide a lead time service level of 96 percent?arrow_forward7. Sam's Cat Hotel operates 52 weeks per year, 5 days per week, and uses a continuous review inventory system. It purchases kitty litter for $11.00 per bag. The following information is available about these bags. Refer to the standard normal table for z-values. ≻Demand = 95 bags/week ≻Order cost = $57/order ≻Annual holding cost = 30 percent of cost ≻Desired cycle-service level=98 percent ≻Lead time = 1 week(s) (5 working days) ≻Standard deviation of weekly demand = 20 bags ≻Current on-hand inventory is 350 bags, with no open orders or backorders. a. What is the EOQ? (Enter your response rounded to the nearest whole number.) and (Enter your response rounded to one decimal place.) b. What should R be? (Enter your response rounded to the nearest whole number.) c. An inventory withdrawal of 10 bags was just made. Is it time to reorder? (is or is not)arrow_forward
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