Joe's Camera shop sells professional cameras to the photographers. They have an ordering cost of $45 per order and the carrying cost is $15 per unit per year. To meet the demand, Joe places orders in large quantities 5 times a year. The stockout cost is estimated to be $40 per camera. Over the past several years, they have observed the following demand during the lead time for their camera: Demand During Lead Time(Cameras) 40 50 60 70 80 90 Probability 0.1 0.2 0.2 0.2 0.2 0.1 The reorder point is 60 cameras without safety stock. What level of safety stock should be maintained? The optimal quantity of safety stock which minimizes the expected total cost is =
Joe's Camera shop sells professional cameras to the photographers. They have an ordering cost of $45 per order and the carrying cost is $15 per unit per year. To meet the demand, Joe places orders in large quantities 5 times a year. The stockout cost is estimated to be $40 per camera. Over the past several years, they have observed the following demand during the lead time for their camera: Demand During Lead Time(Cameras) 40 50 60 70 80 90 Probability 0.1 0.2 0.2 0.2 0.2 0.1 The reorder point is 60 cameras without safety stock. What level of safety stock should be maintained? The optimal quantity of safety stock which minimizes the expected total cost is =
A First Course in Probability (10th Edition)
10th Edition
ISBN:9780134753119
Author:Sheldon Ross
Publisher:Sheldon Ross
Chapter1: Combinatorial Analysis
Section: Chapter Questions
Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...
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Transcribed Image Text:Joe's Camera shop sells professional cameras to the
photographers. They have an ordering cost of $45 per
order and the carrying cost is $15 per unit per year. To
meet the demand, Joe places orders in large
quantities 5 times a year. The stockout cost is
estimated to be $40 per camera. Over the past
several years, they have observed the following
demand during the lead time for their camera:
Demand During Lead
Time(Cameras)
40
50
60
70
80
90
Probability
0.1
0.2
0.2
0.2
0.2
0.1
The reorder point is 60 cameras without safety stock.
What level of safety stock should be maintained? The
optimal quantity of safety stock which minimizes the
expected total cost is =
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