Advanced Inventory Inclass Problems.pptx

Advanced Inventory Inclass Problems.pptx - Statistical...

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Statistical Reorder Point example
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Question What is the new safety stock in the problem above change if the probability of a stock out falls to 1%? Average demand during LT = 550 Std. dev = 40 P(stock out) = 1% Z = 2.33 A = 93 B = 66 C = 78 D = 86
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Question Calculate the statistical ROP for the following: Demand is normally distributed with average demand during lead time of 500 and the standard deviation of demand during lead time = 50. Assume a service level of 95% (z=1.65) A. 82 B. 582 C. 500
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Question If I desire the chance of a stock out decreases, then the statistical ROP will: A. Increase B. Decrease C. Stay the same D. Cannot be determined
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Question When using the Quantity Discount Model, if the EOQ on the TAIC curve with the lowest price is feasible, it is the optimal order quantity. A. True B. False
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Question
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