Demand for walnut fudge ice cream at the Sweet Cream Dairy can be approximated by a normaldistribution with a mean of 21 gallons per week and a standard deviation of 3.5 gallons per week.The new manager desires a service level of 90 percent. Lead time is two days, and the dairy isopen seven days a week. (Hint: Work in terms of weeks.)a. If an ROP model is used, what ROP would be consistent with the desired service level? Howmany days of supply are on hand at the ROP, assuming average demand?b. If a fixed-interval model is used instead of an ROP model, what order size would be needed forthe 90 percent service level with an order interval of 10 days and a supply of 8 gallons on handat the order time? What is the probability of experiencing a stockout before this order arrives?c. Suppose the manager is using the ROP model described in part a. One day after placing anorder with the supplier, the manager receives a call from the supplier that the order will bedelayed because of problems at the supplier’s plant. The supplier promises to have the orderthere in two days. After hanging up, the manager checks the supply of walnut fudge ice creamand finds that 2 gallons have been sold since the order was placed. Assuming the supplier’spromise is valid, what is the probability that the dairy will run out of this flavor before theshipment arrives?
Critical Path Method
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 getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
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 undertakes in purchasing or hiring factor of production or factor services.
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 of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
Demand for walnut fudge ice cream at the Sweet Cream Dairy can be approximated by a normal
distribution with a mean of 21 gallons per week and a standard deviation of 3.5 gallons per week.
The new manager desires a service level of 90 percent. Lead time is two days, and the dairy is
open seven days a week. (Hint: Work in terms of weeks.)
a. If an ROP model is used, what ROP would be consistent with the desired service level? How
many days of supply are on hand at the ROP, assuming average demand?
b. If a fixed-interval model is used instead of an ROP model, what order size would be needed for
the 90 percent service level with an order interval of 10 days and a supply of 8 gallons on hand
at the order time? What is the probability of experiencing a stockout before this order arrives?
c. Suppose the manager is using the ROP model described in part a. One day after placing an
order with the supplier, the manager receives a call from the supplier that the order will be
delayed because of problems at the supplier’s plant. The supplier promises to have the order
there in two days. After hanging up, the manager checks the supply of walnut fudge ice cream
and finds that 2 gallons have been sold since the order was placed. Assuming the supplier’s
promise is valid, what is the probability that the dairy will run out of this flavor before the
shipment arrives?
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