Operations Management: Processes and Supply Chains (11th Edition)
11th Edition
ISBN: 9780133872132
Author: Lee J. Krajewski, Manoj K. Malhotra, Larry P. Ritzman
Publisher: PEARSON
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Chapter 9, Problem 5AME
Summary Introduction
Interpretation: The effects on EOQ and total cost if unit price & demand gets doubled are to be discussed.
Concept Introduction: Ordering Optimum size (creating no additional or shortage of materials in stock) at minimum ordering cost is EOQ and aggregating annual holding & ordering cost gets total cost
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Explain why it is not necessary to include product cost(price or price times quantity) in the EOQ model, but thequantity discount model requires this information.
Explain why it is not necessary to include product cost (price or price time quanity in the EOQ model, but the quantity discount model requires this information ?
Part Number Part Unit Value in $ Quantity currently in inventory Average annual usage
1234
2.5
3000
1235
0.2
900
1236
15
1000
1237
0.75
7900
1238
7.6
2800
1239
4.4
5000
1240
1.8
1800
1241
0.05
1200
1242
17.2
2000
1243
2500
1244
7000
300
550
400
50
180
20
200
10
950
160
430
9
3.2
given following table, perform ABC classification
Chapter 9 Solutions
Operations Management: Processes and Supply Chains (11th Edition)
Ch. 9 - What is the relationship between inventory and the...Ch. 9 - Suppose that a large discount retailer with a lot...Ch. 9 - Will organizations ever get to the point where...Ch. 9 - A part is produced in lots of 1,000 units. It is...Ch. 9 - Prince Electronics, a manufacturer of consumer...Ch. 9 - Terminator, Inc. manufactures a motorcycle part in...Ch. 9 - Ruby-Star Incorporated is considering two...Ch. 9 - Haley Photocopying purchases paper from an...Ch. 9 - Prob. 6PCh. 9 - Southern Markets, Inc. is considering the use of...
Ch. 9 - New Wave Shelving’s inventory manager would like...Ch. 9 - Yellow Press, Inc. buys paper in 1,500-pound rolls...Ch. 9 - Babble, Inc. buys 400 blank cassette tapes per...Ch. 9 - At Dot Com, a large retailer of popular books,...Ch. 9 - Leaky Pipe, a local retailer of plumbing supplies,...Ch. 9 - Sam’s Cat Hotel operates 52 weeks per year, 6...Ch. 9 - Consider again the kitty litter ordering policy...Ch. 9 - In a Q system, the demand rate for strawberry ice...Ch. 9 - Petromax Enterprises uses a continuous review...Ch. 9 - In a continuous review inventory system, the lead...Ch. 9 - In a two-bin inventory system, the demand for...Ch. 9 - You are in charge of inventory control of a highly...Ch. 9 - Your firm uses a continuous review system and...Ch. 9 - A company begins a review of ordering policies for...Ch. 9 - Prob. 22PCh. 9 - The Farmer’s Wife is a country store...Ch. 9 - Prob. 24PCh. 9 - Prob. 25PCh. 9 - Prob. 26PCh. 9 - In a P system, the lead time for a box of...Ch. 9 - Suppose that Sam’s Cat Hotel in Problem 13 uses...Ch. 9 - Your firm uses a periodic review system for all...Ch. 9 - Using the same information as in Problem 21,...Ch. 9 - Wood County Hospital consumes 1,000 boxes of...Ch. 9 - A golf specialty wholesaler operates 50 weeks per...Ch. 9 - What is the EOQ and what is the lowest total cost?Ch. 9 - What is the annual cost of holding inventory at...Ch. 9 - Prob. 3AMECh. 9 - Prob. 4AMECh. 9 - Prob. 5AMECh. 9 - Prob. 6AMECh. 9 - Comment on the sensitivity of the EOQ model to...Ch. 9 - Consider the pressures for small versus large...Ch. 9 - Prob. 2VCCh. 9 - The Marker Maker© product recently experienced an...Ch. 9 - Prob. 1CCh. 9 - Prob. 2C
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- What is the EOQ and what is the lowest total cost?arrow_forwardWhen quantity discounts are offered, why is it not necessary to check discount points that are below the EOQ orpoints above the EOQ that are not discount points?arrow_forwardBriefly explain the costs associated with EOQ model. If production cost goes up, what is the impact on the EOQ quantity?arrow_forward
- Suppose Total cost is "A" and EOQ is "B" How much does the total cost increase if the store manager orders twice as many bird feeders as the EOQ? How much the total cost increase if the store manager orders half as many bird feeders as the EOQ? What will be the steps.arrow_forwardWhat are the basic EOQ model's assumptions, and to what extent do they limit the model's utility?arrow_forwardMicro-Electronics Warehouse Headset and Webcam Sale Item Type Reg. Price After Savings Price BuddyChat 200 Headset $34.72 $24.40 BuddyChat 300 Headset $41.27 $34.91 BuddyCam HD Webcam $83.54 $61.46 You have decided to purchase the headset with the greatest markdown percent and the BuddyCam HD webcam in order to take advantage of an "Extra $15 Rebate" offer when you purchase both. What is the markdown percent on your total purchase including the rebate?arrow_forward
- WRITE A SHORT NOTE ON EOQ AND FOQ MODEL?arrow_forwardThe Lemma Company manufactures and sells ten products. Managers find ways to reduce the setup and inventory-holding costs by one-half. What effect will this have on the EOQs for the ten products?arrow_forwardFind arc elasticity of demand, if quantity demanded falls from 1000 to 950 when price of the item is increased from Rs. 240 to Rs. 280? A) 0.33 B) 0.3 C) -0.3 D) -0.33arrow_forward
- 7. Explain why it is not necessary to include product cost (price or price times quantity) in the EOQ model, but the quantity inventory system. discount model requires this information.arrow_forwardDefine each of the following terms: c. Economic Ordering Quantity (EOQ); EOQ model; EOQ rangearrow_forwardDiscuss why is it not necessary to include product cost in the EQQ model, but the quantity inventory system, discount model requires this information ?arrow_forward
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