Meem 6015 hw3 solution

# Meem 6015 hw3 solution - MEEM6015 Supply Chain Management...

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MEEM6015: Supply Chain Management HW 3: Inventory Control and Management Question 1 ( 40%) Choose either product A or product B to show the detailed computation of the numbers in the Table entitled “Inventory Levels” in the risk pooling example. For both products, an order from the factory costs \$60 per order and holding inventory costs are \$0 . 27 per unit per week. Once an order is placed, the lead time is ﬁxed and equal to 1 week. Suppose that the service level of 97 percent is desired. All the data above are assumed to be equalized in the decentralized distribution system and the centralized one. In what follows, the answer is given to the case of product A in Massachusetts. Average weekly demand is AV G = 33 + 45 + 37 + 38 + 55 + 30 + 18 + 58 8 39 . 3 . Standard deviation is STD = " 1 8 8 X i =1 ( x i - AV G ) 2 # 1 2 13 . 2 , (1) 1

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where x i is the demand of the i th week. Safety stock is
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## This note was uploaded on 03/05/2010 for the course MEEM 6015 taught by Professor Kwok during the Spring '10 term at City University of Hong Kong.

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Meem 6015 hw3 solution - MEEM6015 Supply Chain Management...

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