Lead time variability is cut in half

Assignment Help Operation Management

Reference no: EM132307792

Suppose for the hospital in question #6, the weekly demand (that averages 1,000 boxes) has a standard deviation of 10 boxes, and the lead time (that averages 1.5 weeks) has a standard deviation of 0.2 weeks. As in #6, the ordering cost is $50 per order, it costs $1 to hold one box in inventory for one year, and inventory is managed with a continuous review policy.

a) If a 95% service level is desired, then what would be the reorder point? Show all your work.

b) If the lead time variability is cut in half (so the standard deviation is 0.1 weeks), then what would be the reorder point? Show all your work.

c) Suppose the hospital orders 1040 boxes each time. How many orders per year do they make, and how many stockouts do they expect in a year? Show all your work.

Reference no: EM132307792

Questions Cloud

System flowchart of cash disbursements system : Prepare a report to Chief Operating Officer to evaluate the processes, risks and internal controls for its expenditure cycle - System flowchart

Three key components of diversity management : First list and then describe, the three key components of diversity management.

Do you think artificial intelligence has affected society : Do you think artificial intelligence has affected Society and businesses?

Estimate a simple linear regression model : Estimate a simple linear regression model and present the estimated linear equation. Then, interpret the coefficient estimates of the linear model

Lead time variability is cut in half : If the lead time variability is cut in half (so the standard deviation is 0.1 weeks), then what would be the reorder point? Show all your work.

Are all welcome to the american dream : Imagine that you are living in the early 1960s. How would this event impact how you go about your everyday life? Please cite your sources.

Brief overview of the organization including its business : Give a brief overview of the organization including its business, location and history.

Regards to their communication and negotiation styles : Samsung, a South Korean firm has recently developed the Infinity Flex. S. Korean Apple negotiators with regards to their communication and negotiation styles.

Should hr even be involved in organizational strategic plan : Select a current job opening and summarize its requirements in the category of skills needed, responsibilities, salary, or other eligibility requirements.

User Account

All Pages