Mail0089 - Q.4(a A commercial crabber who fishes 350 pots...

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Unformatted text preview: Q.4 (a) A commercial crabber who fishes 350 pots per day orders bait in quantities of 50 crates per order. Because of weather conditions, he is unable to fish his pots with any regularity, so his weekly ’demand for bait is normally distributed with a mean of 25 crates and a standard deviation of 5. Since the bait must be refrigerated, the annual holding costs are Rs 450 per crate, with backorder costs of Rs 750 per outage. If it takes him a week to have bait ordered and delivered, what should be his reorder point? (8) (b) An item has the following characteristics: Unit price = Rs 500, holding cost fraction = 20%, annual demand = 130 units, lead time = 3 weeks, ordering cost = Rs 400 per order, and s.d. of demand = 26 units. The annual demand is normally distributed. If the manager will tolerate only one backordering outage per year, compute the EOQ and ROP for the item. (3) Q5 (21) Optimal solutions for constrained inventory systems need to be determined. How? (explain the procedure) Why? (state with reference to two situations) (5 + 3) (b) State and prove the Tchebycheff inequality. How is it used for decision making in inventory problems? (4 + 4) (2.6 (a) State the difference between: (2 x 6 = 12) (i) All—units and incremental discounts (ii) Payoff matrix and regret matrix (iii) Backordering and lost sales (iv) Open stores and closed stores (v) First cost and total cost of purchase (vi) MRP and DRP (b) State the assumptions of EOQ and EPQ models. . (2 + 2) 0.7 (a) Mention the steps that need to be followed for inventory study in an organization. (4) (b) State four situations where the stockout is prohibitively costly. (4) (c) Amobile home fabricator has an annual demand of 10,000 units for a small refilgerator. The supplier sells the units for Rs 5,000 in order quantities below 125 and for Rs 4,500 in order quantities above 124 units. The order cost is Rs 250, and the annual holding cest is 10% of unit value. (i) In what quantities should the item be purchased with an all-units quantity discount? (4) (ii) What will be the maximum inventory level? ' (4) P (W a H) ...
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