Chapter%208%20Problems

Chapter%208%20Problems - Click to edit Master subtitle...

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Unformatted text preview: Click to edit Master subtitle style EIN 6336 Problems from Chapter 8 8.3 • Ceiling Drug is concerned about the inventory control of an important item. Currently they are using an ( s , Q ) system where Q is the EOQ and the safety factor k is selected based on a B 2 v shortage costing method. Relevant parameter values are estimated to be: • D = 2500 units/yr; B 2 = 0.6; v = $10/unit; A = $5; r = 0.25 $/$/yr; ˆ 500; 100 L L x σ = = 8.3 • a. What are the Q and s values currently in use? 2*5*2500 100 10*0.25 Q = = ( 29 2 100*0.25 0.01667 2500*0.6 2.13 500 2.13*100 713 u Qr p k DB k s ≥ = = = = = + = 8.3 • b. Determine the simultaneous best values of Q and s . ▫ From spreadsheet solver:  Q = 144.4; s = 697.6 ( k = 1.98) • c. What is the percent penalty (in the total replenishment, carrying, and shortage costs) of...
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This note was uploaded on 02/15/2011 for the course EIN 6336 taught by Professor Staff during the Spring '08 term at University of Florida.

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Chapter%208%20Problems - Click to edit Master subtitle...

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