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Ray’s Satellite Emporium wishes to determine the best order size for its best-selling satellite dish (model TS111). Each unit costs $160. Ray has estimated the annual demand for this model at 1000 units. His cost to carry one unit is 5% of the product cost per month per unit. He has estimated that each order costs $500 to place. Answer the following questions. (Keep 2 decimal places for non-integer results)
1. What is the holding cost (in dollars) per unit per year?
2. If the company orders 200 units each time, what is the cycle time (in months)? What is the order frequency (how many cycles per year)? What is the annual inventory holding cost? What is the annual inventory ordering cost?
3. If the company orders every other month, what is the cycle time and what is the order quantity?
Using the data of question 9, suppose the manufacturer has an inflated demand forecast as follows: Quantity Probability 2,200 5% 2,300 6% 2,400 10% 2,500 17% 2,600 30% 2,700 17% 2,800 12% 2,900 3%
Over the past 5 weeks at Winstons Winery has been 1,050, 2,400, 3,300, 1,800, and 1,150, bottles. Winston has placed weekly orders for glass bottles of 1,050, 2,400, 4,100, 950, and 900 units.
Now develop a modified level strategy where you can hire (or layoff) at the beginning of the year only. There are to be no backorders, but inventory and overtime is allowed. What is the total additional cost of this plan?
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Has your employer taken any action to help and encourage you to be a better health care consumer? If yes, what specifically have they done?
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