Operations and Supply Chain Management, 9th Edition WileyPLUS Registration Card + Loose-leaf Print Companion
9th Edition
ISBN: 9781119371618
Author: Roberta S. Russell
Publisher: Wiley (WileyPLUS Products)
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Textbook Question
Chapter 12, Problem 9P
Mary Hernandez has invested in a stock mutual fund and she is considering liquidating and investing in a bond fund. She would like to
- a. Using a three-month moving average, forecast the fund price for month 21.
- b. Using a three-month weighted average with the most recent month weighted .60, the next most recent month weighted .30, and the third month weighted .10, forecast the fund price for month 21.
- c. Compute an exponentially smoothed forecast using α = .40 and forecast the fund price for month 21.
- d. Compare the forecasts in (a), (b), and (c) using MAD and indicate the most accurate.
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Sam's Pet Hotel operates 51 weeks per year, 6 days per week, and uses a continuous review inventory system. It purchases kitty litter for $11.00 per bag.
The following information is available about these bags:
> Demand
95 bags/week
> Order cost $52.00/order
> Annual holding cost = 25 percent of cost
> Desired cycle-service level = 80 percent
>Lead time 4 weeks (24 working days)
> Standard deviation of weekly demand = 15 bags
> Current on-hand inventory is 320 bags, with no open orders or backorders.
a. Suppose that the weekly demand forecast of 95 bags is incorrect and actual demand averages only 75 bags per week. How much higher will total
costs be, owing to the distorted EOQ caused by this forecast error?
The costs will be $
higher owing to the error in EOQ. (Enter your response rounded to two decimal places.)
Sam's Pet Hotel operates 50 weeks per year, 6 days per week, and uses a continuous review inventory system. It purchases kitty litter for $10.50 per bag.
The following information is available about these bags:
> Demand = 95 bags/week
> Order cost = $55.00/order
> Annual holding cost = 35 percent of cost
> Desired cycle-service level = 80 percent
> Lead time = 4 weeks (24 working days)
> Standard deviation of weekly demand = 15 bags
> Current on-hand inventory is 320 bags, with no open orders or backorders.
a. Suppose that the weekly demand forecast of 95 bags is incorrect and actual demand averages only 75 bags per week. How much higher will total
costs be, owing to the distorted EOQ caused by this forecast error?
The costs will be $ 10.64 higher owing to the error in EOQ. (Enter your response rounded to two decimal places.)
b. Suppose that actual demand is 75 bags but that ordering costs are cut to only $13.00 by using the internet to automate order placing. However, the buyer
does…
Chapter 12 Solutions
Operations and Supply Chain Management, 9th Edition WileyPLUS Registration Card + Loose-leaf Print Companion
Ch. 12 - List some of the operations and functions in a...Ch. 12 - What is the difference between quantitative...Ch. 12 - Describe the difference between short- and...Ch. 12 - Prob. 4QCh. 12 - Why is accurate forecasting so important to...Ch. 12 - Discuss the relationship between forecasting and...Ch. 12 - Prob. 7QCh. 12 - Describe the Delphi method for forecasting.Ch. 12 - What is the difference between a trend and a cycle...Ch. 12 - How is the moving average method similar to...
Ch. 12 - In the chapter examples for time series methods,...Ch. 12 - What effect on the exponential smoothing model...Ch. 12 - How does adjusted exponential smoothing differ...Ch. 12 - What determines the choice of the smoothing...Ch. 12 - How does the linear trend line forecasting model...Ch. 12 - Of the time series models presented in this...Ch. 12 - What advantages does adjusted exponential...Ch. 12 - Describe how a forecast is monitored to detect...Ch. 12 - Explain the relationship between the use of a...Ch. 12 - Selecting from MAD, MAPD, MSE, E, and E, which...Ch. 12 - What is the difference between linear and multiple...Ch. 12 - Define the different components (y, x, a, and b)...Ch. 12 - A company that produces video equipment, including...Ch. 12 - The Hartley-Davis motorcycle dealer in the...Ch. 12 - The manager of the I-85 Carpet Outlet needs to be...Ch. 12 - The LawnPlus Fertilizer Company distributes...Ch. 12 - Graph the demand data in Problem 12.3. Can you...Ch. 12 - The chairperson of the department of management at...Ch. 12 - The manager of the Excom Service Station wants to...Ch. 12 - The Intrepid mutual fund of growth stocks has had...Ch. 12 - The Oceanside Hotel is adjacent to City Coliseum,...Ch. 12 - Mary Hernandez has invested in a stock mutual fund...Ch. 12 - Globetron manufactures components for use in small...Ch. 12 - The Bee Line Caf is well known for its popular...Ch. 12 - For the demand data in Problem 12.11, develop a...Ch. 12 - Develop a seasonally adjusted forecast for the...Ch. 12 - Backstreets Pizza delivery service has randomly...Ch. 12 - The Willow River Mining Company mines and ships...Ch. 12 - The Great Northwest Outdoor Company is a catalog...Ch. 12 - Townside Food Vending operates vending machines in...Ch. 12 - The town aquatic center has an indoor pool that...Ch. 12 - Develop an adjusted exponential smoothing forecast...Ch. 12 - During the past five months the emergency room at...Ch. 12 - At its craft store and through its website, the...Ch. 12 - A group of business students at Tech organized a...Ch. 12 - Temco Industries has developed a forecasting model...Ch. 12 - Monitor the forecast in Problem 12.23 for bias...Ch. 12 - Develop a statistical control chart for the...Ch. 12 - Monitor the adjusted exponential smoothing...Ch. 12 - Develop an exponential smoothing forecast with =...
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