Consider a hardware supply warehouse that is contractually obligated to deliver 1000 units a specialized fastener to a local manufaturing company each week. Each time the warehouse places an order for these items from its supplier, an ordering and transporation fee off $20 is charged to the warehouse. The warehouse pays $1.00 for each fastener and charges the local firm $5.00 for each fastener. Annual holding cosst iss 25% off inventory value, or $0.25 per year. The warehouse manager would like to know how much to order when inventory gets to zero. Assume that the warehouse works 50 weeks/year.

Consider a hardware supply warehouse that is contractually obligated to deliver 1000 units a specialized fastener to a local manufaturing company each week. Each time the warehouse places an order for these items from its supplier, an ordering and transporation fee off $20 is charged to the warehouse. The warehouse pays $1.00 for each fastener and charges the local firm $5.00 for each fastener. Annual holding cosst iss 25% off inventory value, or $0.25 per year. The warehouse manager would like to know how much to order when inventory gets to zero. Assume that the warehouse works 50 weeks/year.

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter10: Introduction To Simulation Modeling

Section10.4: Simulation With Built-in Excel Tools

Problem 14P

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