11th Edition

ISBN: 9780132921145

Author: Jay Heizer

Publisher: PEARSON

Concept explainers

The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project get…

Cost Analysis

The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer …

Inventory Management

Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.

Project Management

Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective…

Videos

Textbook Question

Chapter 12, Problem 38P

Question

••• 12.38 University of Florida football programs are printed 1 week prior to each home game. Attendance averages 90,000 screaming and loyal Gators fans, of whom two-thirds usually buy the program, following a normal distribution, for $4 each. Unsold programs are sent to a recycling center that pays only 10 cents per program. The standard deviation is 5,000 programs, and the cost to print each program is $1.

a. What is the cost of underestimating demand for each program?
b. What is the overage cost per program?
c. How many programs should be ordered per game?
d. What is the stockout risk for this order size?

Features Features Normal distribution is characterized by two parameters, mean (µ) and standard deviation (σ). When graphed, the mean represents the center of the bell curve and the graph is perfectly symmetric about the center. The mean, median, and mode are all equal for a normal distribution. The standard deviation measures the data's spread from the center. The higher the standard deviation, the more the data is spread out and the flatter the bell curve looks. Variance is another commonly used measure of the spread of the distribution and is equal to the square of the standard deviation.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 12, Problem 37P

Chapter 12, Problem 39P

Students have asked these similar questions

Question2: A company that sells fruit juices sells 1250 cases of fruit juice from cases priced at $50 per case in a month. The business is in city x and juices are ordered from city y. Each order costs the business $250. Storage costs are 20% of a case of fruit juice. According to this;a) the economic order quantity of the enterprise?b) How many days is the time between two orders?c) What is the total inventory cost of the business, including the acquisition costs, in dollars/month?

question #2 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. If the retailer wants to achieve a 99% service level (use the z-value with one decimal, as in Table 13.4 on page 400 of the textbook), what should be the safety stock value? Numeric Response 772.8 SHARE f5 f6 4- f7 ♫+ fg fil W f12. insert prt sc delete home @ 0 end 1:23 PM 11/15/2022 pg L

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 up

Chapter 12 Solutions

Operations Management

Ch. 12 - Question 1. Describe the four types of inventory.Ch. 12 - Question 2. With the advent of low-cost...Ch. 12 - Question 3. What is the purpose of the ABC...Ch. 12 - Question 4. Identify and explain the types of...Ch. 12 - Question 5. Explain the major assumptions of the...Ch. 12 - Question 6. What is the relationship of the...Ch. 12 - Question 7. Explain why it is not necessary to...Ch. 12 - Question 8. What are the advantages of cycle...Ch. 12 - What impact does a decrease in setup time have on...Ch. 12 - When quantity discounts are offered, why is it not...

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.

Solution Summary: The author explains the cost of underestimating demand and the overage cost per program.

Concept explainers

Videos

Want to see the full answer?

Chapter 12 Solutions