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1. Identify the appropriate inventory model to obtain the optimal lot size for the given problem description:
A small grocery store sells fresh produce, which it obtains from a local farmer. During the strawberry season, demand for fresh strawberries can be reasonably approximated using a normal distribution with a mean of 40 quarts per day and a standard deviation of 6 quarts per day. The grocer purchases fresh strawberries daily from the local farmer for $1.5 per quart and sells them for $3.20 per quart. At the end of each business day, any remaining strawberries are sold to a producer of fresh juice for 50 cents.
a. None of the listed
b. ROP
c. Single Period
d. Fixed Order Interval
e. EOQ
2. A produce distributor uses 800 packing crates a month, which it purchases at a cost of $10 each. The manager has assigned an annual carrying cost of 35 percent of the purchase price per crate. Ordering costs are $28. Currently, the manager orders twice a month. What is their current ordering quantity? Note: Assume that the demand rate is constant and shortages are not allowed.
a. none of the listed
b. 800
c. 1600
d. 400
e. 113
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