Inventory_Models_with_Variable_Demand_and_Lead_Time

Inventory_Models_with_Variable_Demand_and_Lead_Time -...

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Inventory Models with Variable Inventory Models with Variable Demand and Lead Time Demand and Lead Time
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Inventory Model with Uncertain Demand Time Inventory Level R Q Uniform Demand Variable Demand Shortage
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EOQ Model with Safety Stock Time Inventory Level R Q Safety Stock
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Reorder Point with Safety Stock stock safety = level service specified a for deviations standard of number the = demand daily of deviation standard the = days in time lead = demand daily average estimated = placed be should order next he at which t level inventory = : Where L Z σ L d R d d In order to determine the reorder point with a certain safety stock level to meet a desirable service level , one can assume that daily demand is uncertain, independently and normally distributed with a known mean and variance. The reorder point for a given service level can then be computed as follows. L L + Z d R = d σ
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Example: Example: Given: day per yd 5 days 10 day per yd 30 = = = d L d σ Determine the reorder point and safety stock for a service level of 95%, i.e. a probability of a stockout equal to 5%.
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