Which of the following is NOT true about the newsvendormodel (Circle ALL statements that are NOT TRUE)i. If the unit cost of the item increases then the optimal quantitydecreasesii. The stockout penalty does not affect the quantity orderediii. The total cost is the unit cost multiplied by the quantity orderediv. If the salvage value increases the quantity ordered decreasesv. If the standard deviation of the demand increases, then thequantity decreases

The newsvendor model is described as a model that the used in inventory management and supply chain…

Answered: Which of the following is NOT true…

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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A small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 36 quarts per day and a standard deviation of 7 quarts per day. Excess costs run .40 cents per quart. The grocer orders 42 quarts per day.Use Table. What is the implied cost of shortage per quart?
Princetown paints ltd manufactures three basic types of paint. emulsion, gloss, and undercoat. using the same mixing machines and direct labour for each of the three products. the Management accountant of Princetown paints was faced with the task of arranging the weekly production for his company. information about the sale price and costs per 100 liters is given in the following table ( all figures in $). sales price per 100 liters ( emulsion 120), ( gloss 126), ( undercoat 110). variable cost per 100 liters ( emulsion 120), ( gloss 126), ( undercoat 110). direct material costs ( emulsion 11), ( gloss 25), ( undercoat 20). direct labour costs ( emulsion 30), ( gloss 36), ( undercoat 24). mixing costs ( emulsion 32), ( gloss 20), ( undercoat 36). other variable costs ( emulsion 12), ( gloss 15), ( undercoat 10). the cost of direct labour is $3 per hour and the variable cost of mixing is $4 per hour. in any one week, direct labour hours are restricted to 8000 hours and mixing machine…
Dart is a product of the Digby company. Digby's sales forecast for Dart is 2067 units. Digby wants to have an extra 10% of units on hand above and beyond their forecast in case sales are better than expected. (They would risk the possibility of excess inventory carrying charges rather than risk lost profits on a stock out.) Taking current inventory into account, what will Dart's Production After Adjustment have to be in order to have a 10% reserve of units available for sale? a. 2053 units b. 2274 units c. 2260 units d. 2067 units
The Instant Paper Clip Office Supply Company sells and delivers office supplies to companies, schools, and agencies within a 50-mile radius of its warehouse. The office supply business is competitive, and the ability to deliver orders promptly is a big factor in getting new customers and maintaining old ones. (Offices typically order not when they run low on supplies, but when they completely run out. As a result, they need their orders immediately.) The manager of the company wants to be certain that enough drivers and vehicles are available to deliver orders promptly and that they have adequate inventory in stock. Therefore, the manager wants to be able to forecast the demand for deliveries during the next month. From the records of previous orders, management has accumulated the following data for the past 10 months: Month Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Orders 145 70 115 85 120 54 82 141 123 94 Compute the…
With a probabilistic model, increasing the service level A. will decrease the level of safety stock level. B. will increase the cost of the inventory holding. C. will have no impact on the cost of the inventory policy. D. will reduce the cost of the inventory holding.
A wallpaper company estimates the demand for a certain pattern to be 925 rolls per year. It costs $750 to set up the presses to print the pattern, plus $150 to print each roll. If the company can store a roll of wallpaper for a year at a cost of $4, how many rolls should it print at a time and how many printing runs on average will it need in a year to minimize production costs? (Assume the wallpaper sells steadily throughout the year, and the company reorders more whenever the stock runs out. Round the number of rolls per print to the nearest whole number and the average number of printing runs per year to two decimal places.) rolls per print rolls print runs per year runs
A package holiday company is about to block book hotel rooms for the coming season. The number of holidays actually booked is equally likely to be any number between 0 and 99 (for simplicity rather than reality). Each room booked costs the company $250 and they can sell them for $350. a) How many rooms should the company book if unsold rooms have no value? b) How many rooms should it book if unsold rooms can be sold as last-minute bookings for $100 each?
is selling Christmas trees. She purchases trees for $10 and sells for $25 each. The number of trees she can sell is normally distributed with a mean of 100 and standard deviation of 30. How many trees should purchase?
How does the requirement that the number of units of model LX produced be at least 60% of the total production affect profits? Show excel
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
If it takes a supplier four days to deliver an order once it has been placed and the standard deviation of daily demand is 10, which of the following is the standard deviation of demand during the lead time?
A manufacturing company faces an uncertain demand for its product at an average of 10,000 units per year. Selling price of the product is IDR. 1.500.000,-. The cost of holding per unit per year is estimated at IDR 350.000,-. Profit of the product is IDR. 300,000,- per unit. If the company could not meet the demand, then the profit will be lost. Ordering lead time is approximately 7 days, and the demand during lead time follows a uniform distribution of 30 to 200 units. a.Determine order quantity and reorder points to minimise the total cost. b. Determine the review period and maximum inventory to minimise the total cost C. Calculate the total cost for item a and b based on the your iteration on the data

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