Probability of stock-out on any given order cycle

Assignment Help Operation Management

Reference no: EM132154865

A product with an annual demand of 1150 units has Co = $22.5 and Ch = $7. The demand exhibits some variability such that the lead-time demand follows a normal probability distribution with µ = 29 and ? = 7.

What is the recommended order quantity? If required, round your answer to two decimal places. Q* =

What are the reorder point and safety stock if the firm desires at most a 3% probability of stock-out on any given order cycle? If required, round your answers to the nearest whole number.

Record point =

Safety stock =

If a manager sets the reorder point at 34, what is the probability of a stock-out on any given order cycle? If required, round your answer to four decimal places. P(Stockout/cycle) =

How many times would you expect a stock-out during the year if this reorder point were used? Number of Orders =

Reference no: EM132154865

Questions Cloud

Practical knowledge management from leading : The company is Starbucks. The course text is: Learning to Fly: Practical Knowledge Management from Leading and Learning Organizations

What are the five major types of departmentalization : What are the four major types of organization structures? What are the five major types of departmentalization?

Defined benefit pension fund : Compare and contrast the investment objective and constraint of an insurance company and defined benefit pension fund.

What is starbucks charity donations to help the public : What is starbucks charity donations to help the public and to the society.

Probability of stock-out on any given order cycle : What is the recommended order quantity? What are reorder point and safety stock if firm desires at most a 3% probability of stock-out on any given order cycle?

Describe three different barriers to effective listening : Describe three different barriers to effective listening and how they develop in the workplace.

When entering into new international market : When entering the global market, how can we cut down on these costs- when entering into a new international market

What are the key issues for starbucks : What are the key issues for Starbucks? What are the problems associated with the decision to offer fair trade coffee from a communications perspective?

Uncontrollable variable from inputs of decision model : Identify the uncontrollable variable from the following inputs of a decision model. The weights for determining the discriminant functions are determined by:

User Account

All Pages