optimal lot sizes and reorder points for this brand
Critical Path Method
The critical path is the longest succession of tasks that has to be successfully completed to conclude a project entirely. The tasks involved in the sequence are called critical activities, as any task getting delayed will result in the whole project getting delayed. To determine the time duration of a project, the critical path has to be identified. The critical path method or CPM is used by project managers to evaluate the least amount of time required to finish each task with the least amount of delay.
Cost Analysis
The entire idea of cost of production or definition of production cost is applied corresponding or we can say that it is related to investment or money cost. Money cost or investment refers to any money expenditure which the firm or supplier or producer undertakes in purchasing or hiring factor of production or factor services.
Inventory Management
Inventory management is the process or system of handling all the goods that an organization owns. In simpler terms, inventory management deals with how a company orders, stores, and uses its goods.
Project Management
Project Management is all about management and optimum utilization of the resources in the best possible manner to develop the software as per the requirement of the client. Here the Project refers to the development of software to meet the end objective of the client by providing the required product or service within a specified Period of time and ensuring high quality. This can be done by managing all the available resources. In short, it can be defined as an application of knowledge, skills, tools, and techniques to meet the objective of the Project. It is the duty of a Project Manager to achieve the objective of the Project as per the specifications given by the client.
25. Billy’s Bakery bakes fresh bagels each morning. The daily demand for bagels is a
random variable with a distribution estimated from prior experience given by
# of bagels sold in
one day
probability
0
.05
5
.10
10
.10
15
.20
20
.25
25
.15
30
.10
35
.05
The bagels cost Billy’s 8 cents to make, and they are sold for 35 cents each. Bagels
unsold at the end of the day are purchased by a nearby charity soup kitchen for 3 cents
each
a) Based on the discrete distribution above, how many bagels should Billy’s bake at the
start of each day?
b) Determine the optimal number of bagels to bake each day using a
distribution
the demand from the discrete distribution above.)
26. Weiss’s paint store uses a reorder point inventory system to control its stock levels. For
a particularly popular white latex paint, historical data show that the distribution of
monthly demand is approximately normal, with mean 28 and standard deviation 8.
Replenishment lead time for this paint is about 14 weeks. Each can of paint costs the
store $6. Although excess demands are back-ordered, the store owner estimates that
unfilled demands cost about $10 each in bookkeeping and loss-of-goodwill costs. Fixed
costs for replenishment are $15 per order, and holding costs are based on a 30 percent
annual rate of interest.
a) What are the optimal lot sizes and reorder points for this brand of paint?
b) What is the optimal safety stock for this paint?
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