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Unformatted text preview: Homework #5 — Due 11/29/07 Chapter 13 1. Mimi runs a mail order business for troll ﬁgurines. Annual demand for the ﬁgurines
is 2000; the holding cost is $1.50 per ﬁgurine; the cost to place an order is $50. What is the economic order quantity? 2. The supplier of troll ﬁgurines has agreed to offer Mimi a discount from the current .
price of $15 per troll down to $12.50 per troll if she will order in quantities of 1000.
How many units should Mimi order (show your work)? Q .12.
TC 7H+ Q 5+1)? la 
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TCIOOO : 12,90 k‘IS + Taefjlk‘ §0*7—000 k‘llC' 13,35—0 3. Jimmy’s delicatessen sells large tins of Toffee. Every Monday he checks his stock of
Toffee tins and orders from his supplier. Two days later, the supplier delivers his order.
The average daily demand is 12 tins of Toffee and the standard deviation of demand over 9 days, which covers the reorder period (7 days) and lead time (2 days), is 20 tins.
Jimmy wants to be in stock 99% of the time. What should the restocking level be? RP:74(¢.7,5 L75Qa/ayr KID+chigéy5
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§\ 4. You are the manager of the TV department at BetterBuy. You are responsible for
ordering plasma TVs and want to have a 97% in stock level. The average daily demand
is 4 units, the average leadtime is 4 days, variance of demand is 2 units per day, and
variance of lead time is 1 day. What is your reorder point? ' F 2 L
470/03 2:233 01:91 Lia/6dr; If“, .. v, \
R010? ‘7‘ 2 LQZJLon/LL: 4¥V+1.57‘8,/4x2,+L/KI 3@ 5. You are selling T—Shirts at tonight’s rock concert. At a typical rock concert, like
tonight, you sell about 250 Tshirts at $35 each. Standard deviation of demand is 25 T
Shirts. The date of the concert is on the shirt. Any you don’t sell at the concert, you can
sell afterward, but only for $8. Each Tshirt costs you $15 to buy from your supplier. If
you want to make the most money, how many Tshirts do you buy and bring to the concert?
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 Spring '08
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