LSCM 360 - Exam 2 Practice Problems

LSCM 360 - Exam 2 Practice Problems - Practice Problems for...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Practice Problems for Exam 2 1. Jim manages inventory of corn chips, but he struggles with inventory levels and stock outs. He hires a consultant, Martens Consulting, LLC, to help him think through his inventory a bit more. Lead time for the past 12 months in days has been 3, 3, 9, 1, 14, and 10. Standard deviation (sigma) of lead time is 5.08. Average daily demand for the last 365 days has been 140 bags, and the standard deviation of daily demand is 30. a. If Jim wants to have bag with 99% certainty, how many bags should Jim have in inventory when he places an order? What Jim wants bags with 95% certainty, how many bags should he have in inventory when he places an order? b. Martens Consulting wants to show Jim how important it is to work with reliable and consistent supply chain partners, so they show Jim how many bags are needed to maintain 95 and 99% certainty if lead time (in days) for the past 6 months were 3, 5, 3, 2, 5, & 5 (standard deviation of lead time is 1.3). What is demand during lead time now?
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 04/02/2008 for the course LSCM 360 taught by Professor Martins during the Spring '08 term at Iowa State.

Page1 / 2

LSCM 360 - Exam 2 Practice Problems - Practice Problems for...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online