Operations Management
17th Edition
ISBN: 9781259142208
Author: CACHON, Gérard, Terwiesch, Christian
Publisher: Mcgraw-hill Education,
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Chapter 10, Problem 14PA
Summary Introduction
To determine: The days-of-supply of inventory.
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Students have asked these similar questions
Which of the following is less likely to represent an inventory ordering cost?
a.
Warehousing costs
b.
Transportation costs per order
c.
Cost of initiating an order
d.
Lost profits from lost sales due to shortages
e.
Cost of production disruptions and set up costs to reinstate production due to shortage of raw materials or components
The principal goal of inventory management systems is to balance the costs of ordering, shipping, and receiving goods with the cost of carrying those goods, while simultaneously meeting the firm's policy with respect to avoiding running short of stock and disrupting production schedules.
True
False
Suppose the newsvendor model is used to manage inventory. Which of the followingcan happen when the order quantity is increased by one unit? a. Expected sales increases by more than one unit.b. Expected leftover inventory increases by more than one unit.c. Expected sales decrease by less than one unit.d. Expected leftover inventory increases by less than one unit.
Chapter 10 Solutions
Operations Management
Ch. 10 - It is costly to hold inventory, but inventory can...Ch. 10 - A delivery truck from a food wholesaler has just...Ch. 10 - Prob. 3CQCh. 10 - Prob. 4CQCh. 10 - Prob. 5CQCh. 10 - Prob. 6CQCh. 10 - Prob. 7CQCh. 10 - Prob. 8CQCh. 10 - Prob. 9CQCh. 10 - Prob. 10CQ
Ch. 10 - Prob. 11CQCh. 10 - Prob. 1PACh. 10 - Prob. 2PACh. 10 - Prob. 3PACh. 10 - An electronics manufacturer has 25 days-of-supply...Ch. 10 - Prob. 5PACh. 10 - Prob. 6PACh. 10 - Prob. 7PACh. 10 - Prob. 8PACh. 10 - An online shoe retailers annual cost of holding...Ch. 10 - Prob. 10PACh. 10 - Prob. 11PACh. 10 - Prob. 12PACh. 10 - Prob. 13PACh. 10 - Prob. 14PACh. 10 - Prob. 15PACh. 10 - Prob. 16PACh. 10 - A retailer has annual sales of 500,000 and an...Ch. 10 - Prob. 18PACh. 10 - Prob. 19PACh. 10 - Prob. 1CCh. 10 - Prob. 3CCh. 10 - Prob. 4C
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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
- Which of the following statements is false? a. Ordering in smaller lot sizes lead to lower inventory holding costs. b. Seasonal inventory is stored to cater predictable surge in demand. c. Cycle inventory is the average amount of inventory used to satisfy demand between replenishments. d. Safety inventory is kept when the demand is less than supply.arrow_forwardPlease do not give solution in image format thanku Yellow Press, Inc., buys paper in 1,500-pound rolls for printing. Annual demand is 2, 750 rolls. The cost per roll is 500$, and the annual holding cost is 28percent of the cost. Each order costs 45$. Part 2 a. How many rolls should Yellow Press order at a time? Yellow Press should order enter your response here rolls at a time. (Enter your response rounded to the nearest whole number.)arrow_forwardIt is costly to hold inventory, but inventory can also be useful in a process because:a. adding inventory to a process will shorten the average time a unit spends in a process.b. adding inventory to a process can help reduce situations in which sales are lost due touncertain demand.c. adding inventory to a process is likely to increase quality.d. adding inventory to a process will increase the profit margin of the item.arrow_forward
- Inventory holding costs are the costs of storing products until they are purchased or shipped to customers.; True or Falsearrow_forwardNEED ALL THREE QUESTIONS Item X is a standard item stocked in a company's inventory of component parts. Each year the firm, on a random basis, uses about 2,700 of item X, which costs $25 each. Storage costs, which include insurance and cost of capital, amount to $9 per unit of average inventory. Every time an order is placed for more item X, it costs $6. a. Whenever item X is ordered, what should the order size be? (Round your answer to the nearest whole number.) b. What is the annual cost for ordering item X? (Round your answer to 2 decimal places.) c. What is the annual cost for storing item X? (Round your answer to 2 decimal places.)arrow_forwardPls do fast within 5 minutes and i will give like for sure Solution must be in typed form Taylor Supply is a wholesaler of office supplies and equipment. Taylor purchases cartons of staples from Barker Manufacturing. Barker offers a price of $7 per carton of staples. Taylor incurs a fixed charge of $90 per order to cover order equipment and clerical costs. Each order takes 3 days to arrive . Taylor has projected sales to be 603 boxes per day. Taylor's accounting department has determined the holding costs relevant for inventory decisions are 28% of unit cost. Assume Q=3000. What is the demand for staples during lead time? 1) Assume Q=3000. What is the demand for staples during lead time? 2) Assume Q=3000. What z value is associated with a 90% confidence level? 3) Assume Q=3000. If Taylor wants a 90% service level, and the standard deviation in daily demand is 250, what is the appropriate reorder point? 4) Assume Q=3000. If Taylor wants to improve their service level to 95%, and…arrow_forward
- A firm that sells 5,000 blivets per month is trying to determine how many blivets to keep in inventory. The financial manager has determined that it costs $200 to place an order.The cost of holding inventory is 4 cents per month per average blivet in inventory. A five-day lead time is required for delivery of goods ordered. (This lead time is known with certainty.) The operating days per year is 250. What is the economic order quantity? What is the reorder point? At the EOQ level, what is the total carrying cost per month? At the EOQ level, what is the total ordering cost per month?arrow_forwardIn a safety stock problem where both demand and lead time are variable, demand averages 150 units per day with a daily standard deviation of 16, and lead time averages 5 days with a standard deviation of 1 day. How much safety stock is required to maintain a 95% customer service level? What is the reorder point? Include the z-score you used to get this answer.arrow_forwardA customer buys 1 ABC Jan 35 put for a premium of $3 and simultaneously buys 100 shares of ABC stock for $35 per share. The customer will break even when the stock is selling for what price per share at expiration?arrow_forward
- At Dot Com, a large retailer of popular books, demand is constant at 20,400 books per year. The cost of placing an order to replenish stock is $75, and the annual cost of holding is $6.00 per book. Stock is received 6 working days after an order has been placed. No backorder is allowed. Assume 250 working days a year. **(Enter your response rounded to the nearest whole number.)** Dot Com's optimal order quantity is ______ books. What is the optimal number of orders per year? What is the optimal enterable quotation in working days quotation between orders? What is the demand during the lead time? What is the reorder Point? What is the inventory position immediately after an order has been placed?arrow_forwardIf the order quantity doubles but the flow rate remains constant, what happens to theaverage amount of time a unit spends in inventory?a. Decreases by more than 50 percent d. Increases by 50 percentb. Decreases by 50 percent e. Increases by more than 50 percentc. Remains unchangedarrow_forwardDemand for an item is constant at 500 units a year. Unit cost is $50, reorder cost is $80 and holding costis 60 per cent of value a year. Any demand that occurs when no stock remains is lost. What is the minimum selling price that makes it profitable to stock the item?arrow_forward
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