Operations Management: Processes and Supply Chains (12th Edition) (What's New in Operations Management)
12th Edition
ISBN: 9780134741062
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Textbook Question
Chapter 9, Problem 30P
Using the same information as in Problem 21, develop the best policies for a periodic review system.
- What value of P gives the same approximate number of orders per year as the EOQ? Round to the nearest week.
- What safety stock and target inventory level provide an 88 percent cycle-service level?
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Annual demand for a product is 13,000 units; weekly demand is 250 units with a standard deviation of 40 units. The cost of placing an order is $100, and the time from ordering to receipt is four weeks. The annual inventory carrying cost is $0.65 per unit.
To provide a 98 percent service probability, what must the reorder point be?
Note: Use Excel's NORM.S.INV() function to find the z value. Round z value to 2 decimal places and final answer to the nearest whole number.
Suppose the production manager is told to reduce the safety stock of this item by 100 units. If this is done, what will the new service probability be?
Note: Use Excel's NORM.S.DIST() function to find the correct probability for your computed z value. Round z value to 2 decimal places and final answer to the nearest whole percent.
Joe Henry's machine shop uses
2,530
brackets during the course of a year. These brackets are purchased from a supplier
90
miles away. The following information is known about the brackets:
Annual demand
2,530
Holding cost per bracket per year
$1.65
Order cost per order
$18.25
Lead time
2 days
Working days per year
250
Part 2
a)
What is the EOQ?
enter your response here
units (round your response to two decimal places).
Part 3
b)
What is the average inventory if the EOQ is used?
enter your response here
units (round your response to two decimal places).
What would be the annual inventory holding cost?
$enter your response here
(round your response to two decimal places).
Part 4
c)
Given the EOQ, how many orders will be made annually?
enter your response here
orders (round your response to two decimal places).
What would be the annual order cost?
$enter your response here
(round…
35
The annual demand for a product is 14,700 units. The weekly demand is 283 units with a standard deviation of 80 units. The cost to place an order is $33.00, and the time from ordering to receipt is eight weeks. The annual inventory carrying cost is $0.20 per unit. a. Find the reorder point necessary to provide a 99 percent service probability.
Note: Use Excel's NORM.S.INVI function to find the z value. Round z value to 2 decimal places.
Chapter 9 Solutions
Operations Management: Processes and Supply Chains (12th Edition) (What's New in Operations Management)
Ch. 9 - What is the relationship between inventory and the...Ch. 9 - Suppose that a large discount retailer with a lot...Ch. 9 - Will organizations ever get to the point where...Ch. 9 - A part is produced in lots of 1,000 units. It is...Ch. 9 - Prince Electronics, a manufacturer of consumer...Ch. 9 - Terminator, Inc. manufactures a motorcycle part in...Ch. 9 - Ruby-Star Incorporated is considering two...Ch. 9 - Haley Photocopying purchases paper from an...Ch. 9 - Prob. 6PCh. 9 - Southern Markets, Inc. is considering the use of...
Ch. 9 - New Wave Shelving’s inventory manager would like...Ch. 9 - Yellow Press, Inc. buys paper in 1,500-pound rolls...Ch. 9 - Babble, Inc. buys 400 blank cassette tapes per...Ch. 9 - At Dot Com, a large retailer of popular books,...Ch. 9 - Leaky Pipe, a local retailer of plumbing supplies,...Ch. 9 - Sam’s Cat Hotel operates 52 weeks per year, 6...Ch. 9 - Consider again the kitty litter ordering policy...Ch. 9 - In a Q system, the demand rate for strawberry ice...Ch. 9 - Petromax Enterprises uses a continuous review...Ch. 9 - In a continuous review inventory system, the lead...Ch. 9 - In a two-bin inventory system, the demand for...Ch. 9 - You are in charge of inventory control of a highly...Ch. 9 - Your firm uses a continuous review system and...Ch. 9 - A company begins a review of ordering policies for...Ch. 9 - Prob. 22PCh. 9 - The Farmer’s Wife is a country store...Ch. 9 - Prob. 24PCh. 9 - Prob. 25PCh. 9 - Prob. 26PCh. 9 - In a P system, the lead time for a box of...Ch. 9 - Suppose that Sam’s Cat Hotel in Problem 13 uses...Ch. 9 - Your firm uses a periodic review system for all...Ch. 9 - Using the same information as in Problem 21,...Ch. 9 - Wood County Hospital consumes 1,000 boxes of...Ch. 9 - A golf specialty wholesaler operates 50 weeks per...Ch. 9 - What is the EOQ and what is the lowest total cost?Ch. 9 - What is the annual cost of holding inventory at...Ch. 9 - Prob. 3AMECh. 9 - Prob. 4AMECh. 9 - Prob. 5AMECh. 9 - Prob. 6AMECh. 9 - Comment on the sensitivity of the EOQ model to...Ch. 9 - Consider the pressures for small versus large...Ch. 9 - Prob. 2VCCh. 9 - The Marker Maker© product recently experienced an...Ch. 9 - Put yourself in Sue McCaskey’s position and...Ch. 9 - By how much do your recommendations for these two...
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