Production and Operations Analysis, Seventh Edition
7th Edition
ISBN: 9781478623069
Author: Steven Nahmias, Tava Lennon Olsen
Publisher: Waveland Press, Inc.
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 5, Problem 50AP
Summary Introduction
Interpretation:Difference in (Q,R) values compared to normal case are to be discussed.
Concept Introduction: Laplace distribution is a continuous probability distribution in which two independent exponential functions are evaluated. These exponential functions are independent of each other with different parameters
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
12. A restaurant uses an average of 8 jars of a special sauce every day. When they place an order, the
jars arrive to the restaurant in a day (lead time is 1 day). Daily usage of sauce has a standard
deviation of 3 jars. They think their demand during the lead time can be modelled with normal
distribution. The manager is willing to accept no more than a 10 percent risk of stockout during
lead time. Calculate at which level of inventory a new order needs to be placed (i.e. calculate the
reorder-point(ROP)).
General Motors is trying to determine how frequently they should have tires delivered to their Flint, Michign truck
assembly plant. The tires are large and expensive to hold in inventory, and there is also a sgiicant fee each te a tire
delivery is made. Which of the following tools would be most useful in making this decision
O A/F Ratio Method
Newsvendor Model
Base Stock Model
Economic Order Quantity Model
Minimum Cycle Length Model
A small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 40 quarts per day and a standard deviation of 6 quarts per day. Excess costsrun 35 cents per quart. The grocer orders 49 quarts per day.a. What is the implied cost of shortage per quart?b. Why might this be a reasonable figure?
Chapter 5 Solutions
Production and Operations Analysis, Seventh Edition
Ch. 5.2 - Prob. 1PCh. 5.2 - Prob. 2PCh. 5.2 - Prob. 4PCh. 5.3 - Prob. 7PCh. 5.3 - Prob. 9PCh. 5.3 - Prob. 12PCh. 5.5 - Prob. 16PCh. 5.5 - Prob. 18PCh. 5.6 - Prob. 21PCh. 5.7 - Prob. 24P
Ch. 5.7 - Prob. 25PCh. 5.7 - Prob. 26PCh. 5.7 - Prob. 27PCh. 5 - Prob. 28APCh. 5 - Prob. 31APCh. 5 - Prob. 32APCh. 5 - Prob. 33APCh. 5 - Prob. 37APCh. 5 - Prob. 38APCh. 5 - Prob. 40APCh. 5 - Prob. 41APCh. 5 - Prob. 43APCh. 5 - Prob. 44APCh. 5 - Prob. 45APCh. 5 - Prob. 46APCh. 5 - Prob. 47APCh. 5 - Prob. 48APCh. 5 - Prob. 49APCh. 5 - Prob. 50APCh. 5 - Prob. 51AP
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.Similar questions
- Problem 12-37 (Algo) A small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 36 quarts per day and a standard deviation of 5 quarts per day. Excess costs run 50 cents per quart. The grocer orders 41 quarts per day. Use Table. What is the implied cost of shortage per quart? (Round your z value to 2 decimal places, your service level probability to 4 decimal places and your final answer to 2 decimal places.) Shortage cost per quartarrow_forward33) please please help me with this Next week, Super Discount Airlines has a flight from New York to Los Angeles that will be booked to capacity. The airline knows from history that an average of 28 customers (with a standard deviation of 14) cancel their reservation or do not show for the flight. Revenue from a ticket on the flight is $122. If the flight is overbooked, the airline has a policy of getting the customer on the next available flight and giving the person a free round-trip ticket on a future flight. The cost of this free round-trip ticket averages $228. Super Discount considers the cost of flying the plane from New York to Los Angeles a sunk cost. By how many seats should Super Discount overbook the flight? Note: Use Excel's NORM.S.INV function to find the z value. Round z value to 2 decimal places. Round your answer to the nearest whole number.arrow_forwardA small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 40 quarts per day and a standard deviation of 6 quarts per day. Excess costsrun 35 cents per quart. The grocer orders 49 quarts per day.a. What is the implied cost of shortage per quart?arrow_forward
- Please do not give solution in image formate thanku. JetAirways flight from Philadelphia to Boston has 350 seats. The high fare on the flight is $1000 and the restricted/low fare is $500. There is ample demand for the low fare class but high fare demand is uncertain. Demand for the high fare is normally distributed with mean 150 and standard deviation of 45. Further, the customers buy low fare tickets well in advance of high fare customers. a. What is the optimal protection level for the high fare tickets? b. What is the expected revenue (in thousands) from high fare passengers when a booking limit of 200 is selected for the low fare tickets? c. The JetAirways Customers’ Bill of rights states that “Customers who are involuntarily denied boarding shall receive $750 in addition to a ticket refund.” The RM department notices that the number of no-shows is normally distributed with a mean of 7.5 and standard deviation of 3. What is the maximum number of reservations in excess of plane…arrow_forwardDairy company SG is producing milk at a fixed rate of 5,000 gallons/hour. The total customer order over a day is 100,000 gallons of milk. This demand is distributed evenly from 8:00 am to 6:00 pm. If there is no milk available, customers will wait until enough is produced to satisfy your orders. The company starts to produce at 8 am with 25,000 gallons in finished goods inventory. In the end, after that all the demand has been met, the plant continues producing until the stock of products finished is restored to 25,000 gallons. When answering the following questions, please address the trucks / milk as a continuous flow process. Start by drawing a graphic indicating how much milk is in stock and how much milk is “on hold” throughout the day. a) At what time of day will customers have to wait for their orders to be filled? b) At what time will customers stop waiting? c) Suppose the milk is collected in trucks with a capacity of 1,250 gallons each. What is the maximum number of trucks…arrow_forwardDemand for team swimsuits at a local sports store is normally distributed with a mean of 205 per day and a standard deviation of 18, while the lead time for new orders of swimsuits is 12 days with a standard deviation of 6. the standard deviation of demand during lead time,arrow_forward
- Solve Problem 14 assuming that the lead time demand follows a Laplace distribution with mean and variance equal to the mean and variance of lead time demand you computed for Problem 14. What difference do you see in the (Q, R) values as compared to those for the normal case?arrow_forwardA small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 36 quarts per day and a standard deviation of 7 quarts per day. Excess costs run .40 cents per quart. The grocer orders 42 quarts per day.Use Table. What is the implied cost of shortage per quart?arrow_forwardA logistics company applies the EOQ model to manage its inventory of spare parts used for maintenance work for their trucks. Daily demand is normally distributed. The average daily demand is 10 units, with a standard deviation of 5 units. The EOQ is found to be 400 units and used as the order size for all orders. Order lead time is 4 days. Currently, the firm has just received an order. In how many days do they need to place the next order? 4 days 36 days 40 days None of the above. Demand is random, so the time until they reach the ROP again is also randomarrow_forward
- A restaurant uses an average of 50 jars of a special sauce each week. Weekly usage ofsauce has a standard deviation of 3 jars. The manager is willing to accept no more than a10 percent risk of stockout during lead time, which is two weeks. Assume the distributionof usage is normal.a. Which of the given formulas is appropriate for this situation? Why?b. Determine the value of z.c. Determine the ROP.arrow_forward17) 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 a service level of 95% is desired, then the company’s safety stock for this component is approximately (Choose the closest value Group of answer choices 336 units 740 units 247 units 150 unitsarrow_forwardA logistics company applies the EOQ model to manage its inventory of spare parts used for maintenance work for their trucks. Daily demand is normally distributed. The average daily demand is 10 units, with a standard deviation of 5 units. The EOQ is found to be 400 units and used as the order size for all orders. Order lead time is 4 days. Currently, the firm has just received an order. In how many days do they need to place the next order?arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Practical Management ScienceOperations ManagementISBN:9781337406659Author:WINSTON, Wayne L.Publisher:Cengage,
Practical Management Science
Operations Management
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:Cengage,
Inventory Management | Concepts, Examples and Solved Problems; Author: Dr. Bharatendra Rai;https://www.youtube.com/watch?v=2n9NLZTIlz8;License: Standard YouTube License, CC-BY