Example 90. A company finds that the demand for an item is uniform at 10,000 units per year. It costs 50 each time to place an order, regardless of the quantity order. If the holding cost is ? 1 per unit per year, find the economic order quantity.
Q: A product is ordered once each year, and the reorder point without safety stock (dL) is 100 units.…
A: Safety Stock Safety stock is a concept used to describe a degree of additional stock held to…
Q: n the order-up-to model, the standard deviation of the order quantities is higher than the standard…
A: Order-up-to is an inventory model. the level of stocks is periodically reviewed and the amount of…
Q: d setup costs are $200 per order. What is the minimum total stock administration cost for the…
A: The total cost of inventory is the sum of purchasing, ordering, and holding charges. The optimal…
Q: A wholesaler has a steady demand for 50 items of a given product each month. The purchase cost of…
A: Given Demand (D) = 600 units Unit cost (Cu) = 6 MU Holding cost (Ch) = Cu x i i = 20% Ordering cost…
Q: Price A Price B Number sold A Number sold B Total Revenue 19 26 =18-0.56*B1+0.33*B2…
A: Excel Model Creation:
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A:
Q: t goods department of a large department store sells 175 units per month of a certain large bath…
A: Annual Demand (D)= 175*12=2100 units Unit cost(C)=$2.50 Cost of placing order=$12.00 Carry cost=27%
Q: In the Walton Bookstore example, suppose thatWalton receives no money for the first 50…
A: In the walton bookstore problem, the main aim is to find optimal order quanottiy for maximization of…
Q: After taking a production seminar, Al Weiss, the owner of Weiss’s paint storementioned in Problem…
A:
Q: 2. An electronic component manufacturer produces supercapacitors. They are sold at a steady rate of…
A: The question is related to the Inventory Management. The Optimum order quantity will be calculated…
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A: Given data; Carrying cost 10 $ per kilo per year Stockout cost 75 $ per kilo Reorder point…
Q: A component used in a manufacturing facility is ordered from an outside supplier.Because the…
A: k= 200 wherein, k is total cost h = (.005)(.65) = .00325/unit µ h = 3.25/thousand.…
Q: Lia ITZY has determined that the annual demand for number 6 screws is 100,000 screws. Lia, who works…
A: Given data is Annual demand(D) = 100,000 Order cost(S) = $10 Holding cost = 0.5(0.01) = $0.005
Q: 2. The maintenance department of a large hospital uses about 3100 cases of liquid cleanser annually.…
A: Ordering cost refers to the cost that gets incurred while creating and processing an order to a…
Q: A component used in a manufacturing facility is ordered from an outside supplier.Because the…
A:
Q: James Beerd bakes cheesecakes and Black Forest cakes. During any month, he can bake at most 65…
A:
Q: A company stocks an item that is consumed at the rate of 30 units each day. Every time an order is…
A: Economic order quantity is the optimal quantity that the business needs to buy the inventory to…
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A: Given data; Carrying cost 15 $ per kilo per year Stockout cost 70 $ per kilo Reorder point…
Q: A component used in a manufacturing facility is ordered from an outside supplier.Because the…
A: Solution: C(1) = 200 WHEREIN C(1) is total cost h = (.005)(.65) = .00325/unit µ h…
Q: The difference(s) between the basic EOQ model and the pro-duction order quantity model is (are)…
A: In inventory management, economic order quantity(EOQ) is the order quantity that reduces the…
Q: Cindy and Mindy were in the same student group while studying for their MBA at UTD. They graduated…
A: Since Cindy knows that Mindy learned only the EOQ model during her MBA, Cindy safely assumes that…
Q: The soft goods department of a large department store sells 175 units per month of a certain large…
A: Annual Demand (D)= 175*12=2100 units Unit cost(C)=$2.50 Cost of placing order=$12.00 Carry cost=27%
Q: OfficePro sells calculators at a rate of 3 per day. When the company places an order from its…
A: Given: Selling rate = 3 per day Optimal order size = 80 units not > 10% chances of out of stock…
Q: A product has a demand of 10,000 units per year. Ordering cost is RO 200, and holding cost is RO 3…
A: EOQ is the method of cost-minimizing technique of inventory.
Q: Tobacco is shipped from North Carolina to a cigarette manufacturer in Cambodia once a year. The…
A: From the given information, Service level, α = Stock out cost÷Stockout +holding cost…
Q: A local supermarket sells a popular brand of shampoo at a fairly steady rate of 380 bottles per…
A: Formula:
Q: Vallie Enterprise sells a product that cost $200 per unit and has a monthly demand of 500 units. The…
A: i) In the above case we have to determine the Economic Order Quantity(EOQ):…
Q: A product has a demand of 3,802 units per year. Ordering cost is 21, and holding cost is 2 per unit…
A: Annual demand=3802 units. Ordering cost=21. Holding cost=2 per unit per year.
Q: Henrique Correa's bakery prepares all its cakesbetween 4 A.M. and 6 A.M. so they will be fresh when…
A: Given that: Mean demand (d) = 25 Standard deviation (s) = 4 Cost of a cake (c) = $6 Selling price…
Q: Open the A2 Liquor Company Excel file. Make the following changes: The profit for beer has increased…
A: Note: - Since the data of the excel file is not given for the first question, we will answer the…
Q: The annual demand for an automobile component is 50,000 units. The carrying cost is Rs.…
A: Since you have submitted question with multiple subparts, as per guideline we have answered the…
Q: ir he achual onder quantity is the ecnomie order quantity in a problem that mets the asmumptione of…
A: The concept of Operation Management: Operation management is the management that applies to a…
Q: Suppose in an EOQ model backorders are used, and the backorder cost has increased whereas all other…
A: The correct answer is
Q: The lead time demand for bathing suits is governed bythe discrete random variable shown in Table 11.…
A: Compute EOQ: Compute the probability:
Q: of carrying one jacket in inventory for one year is 0.40. The given solution is this: 200 =…
A: Given: Setup cost=$2.00 Number of jackets=4000 optimal production cost=200 cost of carrying?
Q: The demand for an electronic component is normally distributed with an average daily demand of 500…
A: For the given statement, the last option is correct - 4,747 units
Q: A component used in a manufacturing facility is ordered from an outside supplier.Because the…
A: Silver Meal Solution (S/M) Start in period 1: C(1) =…
Q: The annual demand for a product of XYZ company is 12.000. The cost of ordering this product is CU25…
A: Find the Given details below: Given Details Annual Demand (D) 12000 Units/Year Setup Cost (S)…
Q: Given this information:Expected demand during lead time = 300 unitsStandard deviation of lead time…
A:
Q: A hospital orders its thermometers from a hospitalsupply firm. The cost per thermometer depends on…
A: a) In case of EOQ79, the per unit cost c is lower and hence the denominator is lower. Lower…
Q: In a fixed order inventory system, the solution of the EOQ model presents the optimal decision that…
A: The ordering costs are the costs incurred during the purchase of resources and materials from the…
Q: The difference(s) between the basic EOQ model and theproduction order quantity model is(are) that:a)…
A: Option (a) is the correct answer, here. The difference between the basic EOQ model and the…
Q: A manufacturing company produces furniture products. The company operates 300 working-day per year.…
A: Given - Annual Demand (D) = 12,000 units Holding Cost (H) = SR 0.10 Setting-up cost (S)= SR 50…
Q: Show that the optimal order quantity for the backloggeddemand model is always at least as large as…
A: For Optimal order quantity Let , Optimum order quantity = OQ Maximum inventory level = M…
Q: Quantity Discount: Consider a quantity discount problem where the yearly demand for the product is…
A: Given Information: Annual Demand (D) = 1480 units EOQ (Q) = 1394 units Ordering Cost (S) = $ 48…
Q: A firm experiences demand with a mean of 100 units perday. Lead time demand is normally distributed,…
A: Calculation of Annual cost of Holding safety stock Thus, the given value is E(X) = 1000Standard…
Q: A confectioner buys plastic boxes in bulk and uses them to pack chocolates. The annual requirement…
A:
Q: A firm experiences demand with a mean of 100 units per day. Lead time demand is normally distributed…
A: Daily Demand = 100 units per day Mean = 1000 units Standard Deviation = 200 units Holding Cost = H =…
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- A component used in a manufacturing facility is ordered from an outside supplier.Because the component is used in a variety of end products, the demand is high. Estimated demand (in thousands) over the next 10 weeks isWeek 1 2 3 4 5 6 7 8 9 10Demand 22 34 32 12 8 44 54 16 76 30The components cost 65 cents each and the interest rate used to compute the holding cost is 0.5 percent per week. The fixed order cost is estimated to be $200. (Hint:Express h as the holding cost per thousand units.)d. Which method resulted in the lowest-cost policy for this problem?A component used in a manufacturing facility is ordered from an outside supplier.Because the component is used in a variety of end products, the demand is high. Estimated demand (in thousands) over the next 10 weeks isWeek 1 2 3 4 5 6 7 8 9 10Demand 22 34 32 12 8 44 54 16 76 30The components cost 65 cents each and the interest rate used to compute the holding cost is 0.5 percent per week. The fixed order cost is estimated to be $200. (Hint:Express h as the holding cost per thousand units.)a. What ordering policy is recommended by the Silver–Meal heuristic?A component used in a manufacturing facility is ordered from an outside supplier.Because the component is used in a variety of end products, the demand is high. Estimated demand (in thousands) over the next 10 weeks isWeek 1 2 3 4 5 6 7 8 9 10Demand 22 34 32 12 8 44 54 16 76 30The components cost 65 cents each and the interest rate used to compute the holding cost is 0.5 percent per week. The fixed order cost is estimated to be $200. (Hint:Express h as the holding cost per thousand units.)c. What ordering policy is recommended by the least unit cost heuristic?
- A component used in a manufacturing facility is ordered from an outside supplier.Because the component is used in a variety of end products, the demand is high. Estimated demand (in thousands) over the next 10 weeks isWeek 1 2 3 4 5 6 7 8 9 10Demand 22 34 32 12 8 44 54 16 76 30The components cost 65 cents each and the interest rate used to compute the holding cost is 0.5 percent per week. The fixed order cost is estimated to be $200. (Hint:Express h as the holding cost per thousand units.)b. What ordering policy is recommended by the part period balancing heuristic?A firm experiences demand with a mean of 100 units perday. Lead time demand is normally distributed, with a meanof 1,000 units and a standard deviation of 200 units. It costs$6 to hold one unit for one year. If the firm wants to meet90% of all demand on time, what will be the annual cost ofholding safety stock? (Assume that each order costs $50.)Using excel. Apply the EOQ model to the following quantity discountsituation for which D5 500 units per year, Co5 $40, and theannual holding cost rate is 20%. What order quantity do yourecommend?DiscountDiscountCategoryOrder Size(%)unit Cost10 to990$10.002100 or more3$9.70
- A company has a demand for 25,750 units annually. The holding cost is 33% of the item cost which is $10.00. The ordering or set-up cost is $250.00 per order and the lead time is 5 days. Assume that there are 350 days per year Suppose a price break of $50 per order is offered for purchase quantities of 2,000 or greater. a) Would you take advantage of this based on the economics of the two offers? b) How much is the difference in the annual cost between these two options? c) What is the reorder point for this inventory strategy? What is the inventory position immediately after an order is placed for the inventory strategy that you have selected?A hospital orders its thermometers from a hospitalsupply firm. The cost per thermometer depends on the ordersize q, as shown in Table 6. The annual holding cost is 25%of the purchasing cost. Let EOQ80 be the EOQ if the costper thermometer is 80¢, and let EOQ79 be the EOQ if thecost per thermometer is 79¢.a Explain why EOQ79 will be larger than EOQ80. b Explain why the optimal order quantity must be ei-ther EOQ79, EOQ80, or 100. c If EOQ80 100, show that the optimal order quan-tity must be EOQ79. d If EOQ80 100 and EOQ79 100, show that theoptimal order quantity must be either EOQ80 or 100.e If EOQ80 100 and EOQ79 100, show that the optimal order quantity must be EOQ79.Change the ordering simulation so that emergencyorders are never made. If demand in any week isgreater than supply, the excess demand is simplylost. Simulate the same (s, S) policies as in theexample.
- If D = 8000 per month, S = $45 per order and H = $x per unit per month. If doubling the holding cost makes the optimal order quantity (EOQ) become 600, what is the value of x?In the calculation of an optimal policy for an all-units discount schedule, you firstcompute the EOQ values for each of the three order costs, and you obtain: Q(0) =800, Q(1) =875, and Q(2) =925. The all-units discount schedule has breakpointsat 750 and 900. Based on this information only, can you determine what the optimal order quantity is? Explain your answer.In the Walton Bookstore example, suppose thatWalton receives no money for the first 50 excesscalendars returned but receives $2.50 for every calendar after the first 50 returned. Does this change theoptimal order quantity?