Solution-What is annual expected cost of pipeline inventory

What is annual expected cost of pipeline inventory

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Reference no: EM132573633

You are in charge of inbound transportation for your company for all products coming into your country from overseas. You use a single ocean carrier, ABC Carriers, and their historical time for transit has been 4 weeks on average with a standard deviation of 1 week. All of your product comes in containers and you have estimated that the value of the product in a container is about $100,000. Your weekly demand, in containers, is about 32 with a standard deviation of 12. Assume a CSL of 95% and a holding charge of 22% per year.

Using ABC Carriers, answer the following questions.

Question 1: What is your annual expected cost of pipeline inventory? Enter your answer in millions of dollars with 2 decimal places.

Question 2: What is your expected annual cost of safety stock? Enter your answer in millions of dollars with 2 decimal places.

Reference no: EM132573633

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What is annual expected cost of pipeline inventory

Reference no: EM132573633

Reference no: EM132573633

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