A small grocery store sells fresh produce, which It obtains from a local farmer. During the strawberry season, demand for freshstrawberries can be reasonably approximated using a normal distribution with a mean of 40 quarts per day and a standard devlation of8 quarts per day. Excess costs run 45 cents per quart. The grocer orders 47 quarts per day.Use IableWhat is the implied cost of shortage per quart? (Round your z value to 2 decimal places, your service level probability to 4 decimalplaces and your final answer to 2 decimal places.)Shortage cost per quart

Answered: Image /qna-images/answer/4c03ca8d-af7c-45df-ac35-4707c95bdc67.jpg

Answered: A small grocery store sells fresh…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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Palin’s Muffler Shop has one standard muffler that fits a large variety of cars. The shop wishes to establish a periodic review system to manage inventory of this standard muffler. Use the information in the following table to determine the optimal inventory target level (or order-up-to level). Annual demand 2,750 mufflers Ordering cost $ 35 per order Standard deviation of daily demand 6 mufflers per working day Service probability 76 % Item cost $ 28.00 per muffler Lead time 4 working days Annual holding cost 22 % of item value Working days 275 per year Review period 21 working days a. What is the optimal target level (order-up-to level)? If the service probability requirement is 93 percent, the optimal target level will: Increase Decrease Stay the same
Fisk Corporation is trying to improve its inventory control system and has installed an online system at its retail stores. Fisk anticipates sales of 58,800 units per year, an ordering cost of $4 per order, and carrying costs of $1.50 per unit. In the second year, Fisk Corporation finds that it can reduce ordering costs to $1 per order, but carrying costs will stay the same at $1.50 per unit. a-1. What is the economic ordering quantity for the second year? Economic ordering quantity (EOQ) a-2. How many orders will be placed during the second year? Number of orders a-3. What will the average inventory be for the second year? Average inventory Total costs units units a-4. What is the total cost of ordering and carrying inventory for second year? LA
A company has an average demand of 30 units per day. The supplier's lead time averages 7 days. Assume that the combined standard deviation of demand over the lead time has been calculated and is equal to 20 units. One unit costs $10 and the inventory carrying cost is 25 percent. What is the reorder point for the company if it decides on a 99 percent service level?
At a recent manufacturing workshop, XYZ, Incorporated explained that demand for disposable masks increase rapidly in March 2020 when quarantine mandates first took effect. At the time, retailers could only place a single order to cover demands through the end of the summer. A certain retailer purchased disposal masks from a supplier at a cost of $20 per unit and sold them for $30 per unit. By the end of summer, demand for masks subsided considerably and all masks that weren't sold during the summer could be sold at a discounted price of $18 per unit. The retailer estimated that demand between March and August would be Normally distributed with mu = 10,000 and sigma = 1525 units With, supply chains becoming more stable since March 2020, the retailer is currently in the process of establishing a contract with a disposable mask supplier. The supplier has agreed to sell masks to the retailer for $18 per unit and will make deliveries any time the supplier places an order for a cost of $100…
A coffee shop consumes 350 lbs of coffee per week at a steady rate. The coffee shop buys coffee from a supplier at the cost of $10 per lb, and ordering cost of $5 per order. The supplier takes 8 days to deliver an order (assume that 1 week = 7 days). What should be the reorder point (in pounds) for the coffee shop (i.e., at what level of inventory it should place an order with the supplier).
In a Q system, the demand rate for strawberry ice cream is normally distributed, with an average of 295 pints per week. The lead time is 6 weeks. The standard deviation of weekly demand is 16 pints. Refer to the standard normal table for z-values. a. The standard deviation of demand during the 6-week lead time is 39 pints. (Enter your response rounded to the nearest whole number.) b. The average demand during the 6-week lead time is 1770 pints. (Enter your response as an integer.) c. The reorder point that results in a cycle-service level of 96 percent is pints. (Enter your response rounded to the nearest whole number.)
Andy's Job Shop buys two parts (Tegdiws and Widgets) for use in its production system from two different suppliers. The parts are needed throughout the entire 52-week year to assemble Uediracs for sale. Tegdiws are used at a relatively constant rate but the use of Widgets vary with demand. Andy wants to improve his inventory management system and use either a "P" system or a "Q" system. What are the advantages and disadvantages of each system in this application and what information is needed to choose between them?
In an ABC system based on revenue, C items individually make the lowest annual revenue contribution. TRUE FALSE
Give typed full explanation
Note: This problem requires the use of a linear programming application such as Solver or Analytic Solver. A firm has prepared the followig binary integer program to evaluate a number of potential new capital projects. The firm's goal is to maximize the net present value of their decision while not spending more than their currently available capital. Max 100x1 + 120x2 + 90x3 + 135x4 ) s.t 150x1 + 200x2 + 225x3 + 175x4 500 (Constraint 1) X1 + x2 + x3 + x4 2 2{Constraint 2) x2 + x4 < 1 {Constraint 3} x2 + x3 2 1 {Constraint 4) x1 = x4{Constraint 5} S 1, if project j is selected 0, otherwise Ij = Set up the problem in Excel and find the optimal solution. Which projects are selected?
7
You are a newsvendor selling the San Pedro Times every morning. Before you get to work, you go to the printer and buy the day's paper for $0.25 a copy. You sell a copy of the San Pedro Times for $1.30. Daily demand is distributed normally with mean = 260 and standard deviation = 46. At the end of each morning, any leftover copies are worthless and they go to a recycle bin. a. How many copies of the San Pedro Times should you buy each morning? Note: Use Excel's NORM.S.INV() function to find the z value. Round your z value and service level to 2 decimal places and final answer to the nearest whole number. Optimal order quantity b. Based on a, what is the probability that you will run out of stock? Note: Round your answer to the nearest whole percent. Probability %

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