The optimal order quantity

Assignment Help Operation Management

Reference no: EM13748793

Part 1

1. The Warren W. Fisher Computer Corporation purchases 8 000 transistors ach year as components in minicomputers. The unit cost of each transistor is $10 and the cost of carrying one transistor in inventory for a year is $3 Ordering cost is $30 per order.

Calculate:

a) The optimal order quantity

b) The expected number of orders placed each year

c) The expected time between orders (Assume that Fisher operates on a 200-day working year)

2. The average daily demand for Apple iPods at a Circuit City store is 15, with a standard deviation of demand during lead time at 7 units.

a. Find the reorder point if management wants a 90% service level (i.e. risks stock-outs only 10% of the time). Please show your work and DRAW THE DISTRIBUTION.

b. How much of this is safety stock?

c. Find the reorder point if management wants a 95% service level (i.e. risks stock-outs only 5% of the time). Please show your work and DRAW THE DISTRIBUTION.

d. How much of this is safety stock?

e. If the standard deviation in demand is 4 units per day, and the lead time is constant at 2 days, what is the standard deviation of DDLT?

Part 2

1. Means doing the right things o create the most value for the company.

A. Efficiency

B. Effectiveness

C. Value

D. Productivity

E. None of these

2. In the context of the book "operations" refers to

A. Activities that take place in a hospital

B. How materials and services are moved

C. Processes that transform resources

D. Coordination of the movement of strategic material

E. None of the above

3. When a Company seeks to match the benefits of a successful competitor position while maintaining it is existing competitive position is called:

A. Fair competitive response

B. Straddling

C. Strategic fitting

D. Activity-system mapping

E. Order Winning

4. The mode of transportation that would probably best suited for transporting coal is

A. Air

B. Trucks

C. Water

D. Rail

E. Options C and D

5. Which of the following is true about JIT systems?

A. The JIT system is based on the philosophy of eliminating waste and utilizing the full capability of the worker.

B. Under JIT, the ideal lot size is one.

C. JIT is typically applied to repetitive manufacturing

D. All of above statements-are true

6. This question tests your prior knowledge of using z-statistics. You will find this practice beneficial for problems of a similar approach that you will encounter in your exams. Please read the problem carefully before answering. PLEASE SHOW YOUR COMPLETE WORK TO RECEIVE CREDIT (I shall credit you on the basis of the work produced):

Suppose that testing for "battery life" results in outcomes that are approximately normally distributed with a mean of 68 and a standard deviation of 9 seconds. If any time less than 60 seconds is deemed defective, what is the probability of defect in the process?

Reference no: EM13748793

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