Production and Operations Analysis, Seventh Edition
7th Edition
ISBN: 9781478623069
Author: Steven Nahmias, Tava Lennon Olsen
Publisher: Waveland Press, Inc.
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Chapter 5.5, Problem 18P
Summary Introduction
Interpretation:
Additional holding cost.
Concept Introduction:
Lot size-reorder point system is one of the multi periods models. This system is denoted by decision variables (Q, R). This multi period models are implemented when there is uncertain demand in inventory control.
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D and L produces high quality plain colored t-shirts and polo jerseys which it sells at its retail outlets across the island. These products are in high demand throughout the year as many companies and individuals purchase them singly and in bulk to have prints put on them.
At one of the retail outlets, located in Chaguanas, the inventory manager notices that he often runs out of stock of black polo jerseys, more often than he likes. He decides that he would aim for a service probability of 97.5%. He places order every other Friday. Each order for the polos takes 5 days to arrive. Past records have shown that there is a daily demand of 20 with a standard deviation of 4. He would also like to ensure that every time he places an order, that he has in stock, 60 of the black polos on hand. The outlet is opened for 250 days for the year. It costs the outlet $80 dollars to place an order the polos.
What size order should the manager place when ordering the black polos?
Alina Limited is a manufacturer of widgets orders components for use in manufacturing. The estimated demand for the components during the coming year is 15,000. Order costs are $100 per order; carrying costs are $12 per component. Using the economic order quantity model
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?
Chapter 5 Solutions
Production and Operations Analysis, Seventh Edition
Ch. 5.2 - Prob. 1PCh. 5.2 - Prob. 2PCh. 5.2 - Prob. 4PCh. 5.3 - Prob. 7PCh. 5.3 - Prob. 9PCh. 5.3 - Prob. 12PCh. 5.5 - Prob. 16PCh. 5.5 - Prob. 18PCh. 5.6 - Prob. 21PCh. 5.7 - Prob. 24P
Ch. 5.7 - Prob. 25PCh. 5.7 - Prob. 26PCh. 5.7 - Prob. 27PCh. 5 - Prob. 28APCh. 5 - Prob. 31APCh. 5 - Prob. 32APCh. 5 - Prob. 33APCh. 5 - Prob. 37APCh. 5 - Prob. 38APCh. 5 - Prob. 40APCh. 5 - Prob. 41APCh. 5 - Prob. 43APCh. 5 - Prob. 44APCh. 5 - Prob. 45APCh. 5 - Prob. 46APCh. 5 - Prob. 47APCh. 5 - Prob. 48APCh. 5 - Prob. 49APCh. 5 - Prob. 50APCh. 5 - Prob. 51AP
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