OPERATIONS MANAGEMENT IN THE SUPPLY CHAIN: DECISIONS & CASES (Mcgraw-hill Series Operations and Decision Sciences)
7th Edition
ISBN: 9781259326738
Author: SCHROEDER
Publisher: MCG
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Chapter 14.S, Problem 1P
eXcel Suppose that for problem 1 in the chapter, the Always Fresh Grocery Store is offered a discount by its supplier if more than 50 cases of tea are ordered at one time. The unit item costs are S80 per case for o to 49 cases and S76 per case for 50 cases or more. This price of $76 applies to the entire order.
- a. Should the grocery store take the discount offer?
- b. What discount is required for the store to be indifferent between taking the discount and ordering the EOQ?
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14. 12 The purchasing manager for the Atlantic Steel Company must determine a policy for
ordering coal to operate 12 converters. Each converter requires exactly 5 tons of coal per day
to operate, and the firm operates 360 days per year. The purchasing manager has determined
that the ordering cost is $80 per order and the cost of holding coal is 20% of the average dollar
value of inventory held. The purchasing manager has negotiated a contract to obtain the coal
for $12 per ton for the coming year.
a. Determine the optimal quantity of coal to receive in each order. (Ans: 1200 tons)
b. Determine the total inventory-related costs associated with the optimal ordering policy
(do not include the cost of the coal). (Ans: TC= $2880)
c. If 5 days of lead time are required to receive an order of coal, how much coal should be on
hand when an order is placed? (Ans= R=300 tons)
The purchasing manager for the Atlantic Steel Company must determine a policy for orderingcoal to operate 12 converters. Each converter requires exactly 5 tons of coal per day to operate,and the firm operates 360 days per year. The purchasing manager has determined that the orderingcost is $80 per order and the cost of holding coal is 20% of the average dollar value of inventoryheld. The purchasing manager has negotiated a contract to obtain the coal for $12 per ton forthe coming year. Determine the total inventory-related costs associated with the optimal ordering policy (do not include the cost of the coal).
The purchasing manager for the Atlantic Steel Company must determine a policy for orderingcoal to operate 12 converters. Each converter requires exactly 5 tons of coal per day to operate,and the firm operates 360 days per year. The purchasing manager has determined that the orderingcost is $80 per order and the cost of holding coal is 20% of the average dollar value of inventoryheld. The purchasing manager has negotiated a contract to obtain the coal for $12 per ton forthe coming year. If 5 days of lead time are required to receive an order of coal, how much coal should be on hand when an order is placed?
Chapter 14 Solutions
OPERATIONS MANAGEMENT IN THE SUPPLY CHAIN: DECISIONS & CASES (Mcgraw-hill Series Operations and Decision Sciences)
Ch. 14.S - eXcel Suppose that for problem 1 in the chapter,...Ch. 14.S - Prob. 2PCh. 14.S - For problem 2 in the chapter, suppose the Grinell...Ch. 14.S - A producer of electronic parts wants to take...Ch. 14 - Identify the different types of inventories (raw...Ch. 14 - Why are stockout costs difficult to determine?...Ch. 14 - What is the difference between a requirements...Ch. 14 - Compare and contrast the management of finished...Ch. 14 - For a given service level, why does a P system...Ch. 14 - Under what circumstances might CPFR be useful, and...
Ch. 14 - Prob. 7DQCh. 14 - What is the appropriate role of inventory turnover...Ch. 14 - Suppose you are managing a chain of retail...Ch. 14 - The Always Fresh Grocery Store carries a...Ch. 14 - The Grinell Machine Shop makes a line of metal...Ch. 14 - The local Toyota dealer has to decide how many...Ch. 14 - Prob. 4PCh. 14 - The famous Widget Company sells widgets at the...Ch. 14 - Prob. 6PCh. 14 - Prob. 7PCh. 14 - An electronics retailer carries a particular...Ch. 14 - An electronics retailer carries a particular...Ch. 14 - The local Toyota dealer has to decide how many...Ch. 14 - The Suregrip Tire Company carries a certain type...Ch. 14 - The Suregrip Tire Company carries a certain type...Ch. 14 - eXcel 13. The Cover-up Drapery Company carries...Ch. 14 - Suppose you are the supplier of the Cover-up...
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