How reduce the safety stock, Operation Management

Assignment Help:

The annual demand for a product is 15,600 units. The weekly demand is 300 units with a standard deviation of 90 units. The cost to place an order is $31.20, and the time from ordering to receipt is four weeks. The annual inventory carrying cost is $0.10 per unit.

a. Find the reorder point necessary to provide a 98 percent service probability.

b. Suppose the production manager is asked to reduce the safety stock of this item by 50 percent. If she does so, what will the new service probability be?


Related Discussions:- How reduce the safety stock

Explain the concept of the quality of assurance system, Q. Explain the conc...

Q. Explain the concept of the quality of assurance system? Quality assurance is a systematic and planned action to give adequate confidence which a product or item conforms to

Explain the drug research and distribution industry, If Merck can donate $5...

If Merck can donate $50 million in free doses of ivermectin, what does that say about the amount of revenue the company generates in the drug research and distribution industry?

Explain the various types of time-series, Describe the various types of tim...

Describe the various types of time-series and associative forecasting models. Which types of organizations are each of these most applicable to, and why?

Explain what are the separate problems, One day a teller of a bank was robb...

One day a teller of a bank was robbed. When the robber ran the teller ran after him. Well over taking the robber, the teller was shot in the leg. The teller was given an award for

Describe independent populations where the variances, In order to test the ...

In order to test the difference in population's means, samples were collected for two independent populations where the variances are assumed equal and the population normally dist

Explain what are the boundary points of the feasible region, Maxwell Manufa...

Maxwell Manufacturing makes two models of felt tip marking pens. Requirements for each lot of pens are given below. Fliptop Model Tiptop Model Available Plastic 3 4

Explain uses a level material usage approach has collected, A firm that ope...

A firm that operates 300 days in a year and uses a level material usage approach has collected the following data: Annual Demand = 30,000; Daily Demand = 100; Daily production= 300

Explain insufficient to handle the increased workload, A company that produ...

A company that produces pleasure boats has decided to expand one of its lines. Current facilities are insufficient to handle the increased workload, so the company is considering t

Explain project life cycle differ from a product life cycle, I asked the wr...

I asked the wrong question last time. I asked it wrong. How does a project life cycle differ from a product life cycle?

Health Care for Women Veterens, NOTE: NOTE: below are the 2 textbooks used...

NOTE: NOTE: below are the 2 textbooks used in the course and it is important to use quantitative analysis techniques covered in both texts. PMBA 6312 Quantitative Methods/Research

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd