Principles Of Operations Management
11th Edition
ISBN: 9780135173930
Author: RENDER, Barry, HEIZER, Jay, Munson, Chuck
Publisher: Pearson,
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Chapter 12, Problem 48P
Gainesville Cigar stocks Cuban agars that have variable lead times because of the difficulty in importing the product: lead time is
a) For a 90% service level, what is the ROP?
b) What is the ROP for a 95% service level?
c) Explain what these two service levels mean. Which is preferable?
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Harvey Gold, orders an unusual olive from the
island of Santorini, off the Greek coast. Over
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Assume 4 weeks each month and 90% service
level. Find the reorder point s, amount of safety
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level, and the annual inventory-related cost.
Table of Z-values for normal distribution:
Service level
Z-value
90%
1.29
91% 92% 93% 94% | 95% 96% 97% 98% 99%
1.65
1.34
1.41
1.48
1.56
1.75
1.88
2.05
2.33
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What is Alina Ltd’s optimum order quantity?
If the supplier guarantees a three (3) day delivery on any order that is placed, What is the re-order point?
Suppose that we would like to determine Reorder Point for the product. From the historical data
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mean of 200 and standard deviation of 10 products. The maximum stock out risk is 10%. Answer
the following questions according to the (Q, R) system.
a) Find the safety stock if the lead time is 2 weeks.
b) Find the reorder point.
c) Find the reorder point if the stock out risk decreases to 1%. Comment on the result.
Chapter 12 Solutions
Principles Of Operations Management
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