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HW04-Sp11_Key[1]

# HW04-Sp11_Key[1] - MGMT36100:HW0440Points Due:March24,2011...

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MGMT 36100: HW 04           40 Points     Due: March 24, 2011 Write proper dimensions. Question 1: (9 points, 1+1+2, 1+2+2) Part (A) Acceptable stock out risk is 4% so SL=96% (a) SS = = 1.76 * 52 = 91.52 [pounds] 92 [pounds] (b) ROP = + SS = 600 [pounds] + 91.52 [pounds] = 691.52 [pounds] (c) Now ROP = 600, which is average demand during the lead time. This will result in stock-out probability = 50% Part (B) Holding cost D = 5 * 52 = 260 [boxes/year]. (a) EOQ = [boxes] 72 [boxes] (b) = LT * = 2 [weeks] * 5 [boxes/week] = 10 [boxes] = * 0.5 = * 0.5 = (ROP - ) / = (12 – 10)/( * 0.5) = 2.83. Stockout probability = 1 – Pr (Z < 2.83) = 1 – 0.9977 = 0.0023 = 0.23% (c) P system: PP = LT + OI = 2 + 7 = 9 [weeks]; OUL = 12 + 36 = 48 [boxes] = PP * = 9 [weeks] * 5 [boxes/week] = 45 [boxes]. OUL = + so = (OUL - ) / = (48 – 45) / ( * 0.5) = 2 Stock-out probability = 1 – Pr(Z < 2.0) = 1 - 0.9772 = 0.0228 Question 2: (6 points) Day Opening IL Opening IP Receipt Order Withdrawal Closing IL Closing IP 1 180 480 0 20 70 110 430 2 110 430 300 100 310 330 3 310 330 0 170 95 215 405 4 215 405 20 120 115 285 5 115 285 0 215 145 -30 355 6 -30 355 170 75 65 280 7 65 280 0 220 70 -5 430 8 -5 430 215 90 120 340 9 120 340 0 160 70 50 430 10 50 430 220 85 185 345 Total 925 785 920 Closing IP (day 7) = 430

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