A factory ships weekly shipments of an item to a distribution center and the average quantity shipped is 350 units. The weekly ordering rate for this distribution center is 50 units for an item. Unit price is $ 650. The period of supply from the factory to the distribution center is two weeks (2 weeks). The distribution center must pay for the stock from the moment the manufacturer ships the goods. If the distribution center wants to increase the purchase quantity to 400 units, the factory will give priority to the distribution center and guarantee it Supply period (one week only). Required: What is the effect on the average cycle inventory and the pipeline inventory of the distribution center? With the necessity to comment on the results.
A factory ships weekly shipments of an item to a distribution center and the average quantity shipped is 350 units. The weekly ordering rate for this distribution center is 50 units for an item. Unit price is $ 650. The period of supply from the factory to the distribution center is two weeks (2 weeks). The distribution center must pay for the stock from the moment the manufacturer ships the goods. If the distribution center wants to increase the purchase quantity to 400 units, the factory will give priority to the distribution center and guarantee it Supply period (one week only). Required: What is the effect on the average cycle inventory and the pipeline inventory of the distribution center? With the necessity to comment on the results.
Advanced Engineering Mathematics
10th Edition
ISBN:9780470458365
Author:Erwin Kreyszig
Publisher:Erwin Kreyszig
Chapter2: Second-order Linear Odes
Section: Chapter Questions
Problem 1RQ
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Transcribed Image Text:A factory ships weekly shipments of an item to a distribution center and the average
quantity shipped is 350 units. The weekly ordering rate for this distribution center is
50 units for an item. Unit price is $ 650. The period of supply from the factory to the
distribution center is two weeks (2 weeks). The distribution center must pay for the
stock from the moment the manufacturer ships the goods. If the distribution center
wants to increase the purchase quantity to 400 units, the factory will give priority to
the distribution center and guarantee it Supply period (one week only).
Required: What is the effect on the average cycle inventory and the pipeline inventory
of the distribution center? With the necessity to comment on the results.
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