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1、Annual demand of an item is 2000 units, the unit cost is $100, reorder cost is $20, inventory holding cost is 35%. Demand for a product is normally distributed mean 200 units a month and standard deviation 30 units a month. Lead time is normally distributed with mean 1 month and standard deviation 0.3 months.
A. Find the safety stock required at 1 combined standard deviation under conditions of demand and replenishment cycle uncertainties.
B. Find the average inventory at 2 standard deviations under demand and replenishment cycle uncertainty.
A. Know conditions:
D=2000 units per year
UC=$100
RC=$20
HC=35%*100=$35 per year
Then,
EOQ= Q0= (2*RC*D/HC) 1/2=48 units
Safety stock = 1* (=1*(2002*0.32+1*302) 1/2=67 units
B.Average inventory=Q/2+SS=24+2*67=158units
2、Demand of an item is constant at 1,000 units a year. Unit cost is $50, Reorder cost is $100, holding cost is 25 percent of value a year and no shortages are allowed. Describe an optimal policy for the item.
A.What order size will give a variable cost within 10 percent of optimal?
B.What is the cost if suppliers only make deliveries of 200 units?
Known conditions:
D=1000 units per year
UC=$50
RC=$100
HC=25%*50=$12.5 per year
Then,
EOQ= Q0= (2*RC*D/HC) 1/2=127 units
VC0=HC*EOQ=127*12.5=1587.5units per year
Given a variable cost within 10 percent of optimal,
VC/VC0=1/2[EOQ/Q+Q/EOQ]
1.1=1/2[1/k+k/1]
k1=0.64, k2=1.56
0.64*EOQ=81 units, 1.56*EOQ=197 units
Therefore, the order size ranges from 81 units to 197 units.
B. VC=RC*D/Q+HC*Q/2= 1000*100/200+50*25%*200/2=$1750
3、Jessica Choi works in her bakery(面包店) for a 6 days a week for 49 weeks a year. Flour(面粉) is delivered directly with a charge of $7.50 for each delivery. Jessica uses an average of 10 sacks of flour a day, for which she pays $12 a sack. She has an overdraft(透支利息) at the bank which cost 12 percent per sack a year, with spillage, storage and insurance costing 6.75 percent per sack a year.
A、What size of delive
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