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IE383_Assignment_9 (1)

# IE383_Assignment_9 (1) - IE 383 Assignment 9 You do not...

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IE 383 Assignment 9 You do not have to turn this assignment in. Problem 1 VV26 Inc. is the lone distributor of a unique industrial plastic container. The estimated annual demand is 15,000 units, annual holding cost is \$5 per container and it costs \$2,000 to initiate a delivery. The company allows maximum shortage up to 200 units with penalty cost of \$5 per unit container and \$1 per unit year container. Assuming that delivery is non-instantaneous, where delivery rate is 2000 units per month, determine the optimal order quantity. Problem 2 The Cheese.com is a distribution company that supplies cheese to stores in its surrounding area. The average cheese demand is 20 lbs/day. Cheese.com operates 340 days in a year. It cost about \$120 to place an order, and the holding cost is \$12/ (lb*year). The annual interest rate is 10%. The Cheese.com just received a promotion package from its supplier as follows: Order quantity (units) Price (\$) 0 < Q < 400 80 400 Q < 600 70 600 Q <750 60 750

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IE383_Assignment_9 (1) - IE 383 Assignment 9 You do not...

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