Supply chains using the order-up-to inventory model, Operation Management

Demand for Caruso's Frozen Pizza (CFP) is normally distributed. The demand for CFP averages 400 per day with a standard deviation of 200. Weekly demand (5 days) averages 2,000 units with a standard deviation of 555. A Cold can essentially order any quantity of CFP it wants each day. Any order for CFPs arrives 4 days after the order. Further, it costs ACold $0.01 per day to keep a CFP in inventory, while a back order is estimated to cost ACold $0.45.

A.    Suppose the base stock level 2,800 is chosen. What fraction of customer demands is met immediately from stock?

B.     Suppose the base stock level 2,800 is chosen. What is the average amount of inventory on order?

C.     Suppose the base stock level 2,800 is chosen. What is the annual holding cost? (Assume 260 days per year)

D.    What base stock level minimizes inventory while maintaining a 97 percent in-stock probability

Posted Date: 2/16/2013 7:09:21 AM | Location : United States







Related Discussions:- Supply chains using the order-up-to inventory model, Assignment Help, Ask Question on Supply chains using the order-up-to inventory model, Get Answer, Expert's Help, Supply chains using the order-up-to inventory model Discussions

Write discussion on Supply chains using the order-up-to inventory model
Your posts are moderated
Related Questions
Process Focused Production System This is a form of production system in which production operations are grouped according to the type of process. In other words, all productio

as a customer service employee to university explain measures you would recommend to make even displeased student to patronise the school canteen

Explain the working of employees in flexible organisations. Working of employees in flexible organisations: • Production workers may be needed to take on indirect tasks as l

YP11-6 Giant Airlines operates out of three main "hub" airports in the United States. Recently Mosquito Airlines began operating a flight from Reno, Nevada, into Giant's Metropolis

Which of the following is a criterion used for selecting a target segment? Potential for increased profit Similarity of needs of potential buyers within a segment Differen

Buckeye Manufacturing expects to generate additional revenue from its recently won government contract. Buckeye forecasts that the revenue will be $40 million in the first year, bu

In this writing assignment, you will create a brochure advertising your services as a data repository. Research commercial data repositories. Be sure to understand this business mo

The following are monthly actual and forecast demand levels for May thru December for units of a product manufactured by the N. Tamimi Pharmaceutical Company: Month Actual Deman

Record of operations in an organisation If the operation to be studied already exists it is important to record its details by direct observation. To help in this, many tools

What are the key planning factors for competitive success? Provide an example of an organization that has achieved competitive success through planning. Provide an example of an or