hw 6 - 10 a R=m z*Standard deviation R= 4(1.7*2.5 R= 8.25...

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Thomas Thai Asoke Dey OMS 3001 April 25, 2007 Home Work 6 2) Q = SQRT(2SD/iC) Q= SQRT{(2*1,200*200)/(.2*25) Q= 480,000/5 Q=310 a. 310 b. 200/310=6.5 per year c. When production set ups have a high cost the lot size would change. 3) D= 48 i=.2 S=15 C=25 EOQ=SQRT(2SD/iC) EOQ= SQRT(2*15*48)/(.2*25) EOQ= 17 a.17 b. 48/17 =2.8 time per year c. TC= SD/Q+iCQ/2 TC=(15*18)/17+(.2*25*17)/2 TC= 42.4+42.5 TC= $85 per year
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Unformatted text preview: 10) a. R=m+z*Standard deviation R= 4+ (1.7*2.5) R= 8.25 units Q= 17 b. P= Q/D P= 17/4 P= 4.25 times per month c. Q System Pros- No stock outs Cons-You are ordering a fixed amount and may need to order more shortly late to keep up with demand. P System Pros- Don’t have to check the inventory so often Cons- More likely to have stock outs...
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