Economic order quantity, Mechanical Engineering

Assignment Help:

Economic Order Quantity:

Assume an economic order quantity case where annual demand D = 500 units, economic order quantity Q = 100 units, the wanted probability of not stocking out P = 0.95, the standard deviation of demand during lead time σ L = 20 units, and Lead time L = 12 days. Discover the reorder point. Suppose that demand is over a 250 = workday year.

Solution

d' in above example is

 d = 500 /250 = 2   and lead time is 12 days.

 From the equation,

R = d'L + z σL  = 2 (12) + z (20)

Since, in this case z is 1.64. Substituting this value of z, we achieved

R = 2 (12) + 1.64 (20) = 24 + 32.8 = 56.8 units

This illustrated that when the stock on hand gets down to 56 units, order 100 more.


Related Discussions:- Economic order quantity

Special tool and cleaning of part general service tips , Special Tool: Use...

Special Tool: Use special tools wherever applicable. Special tools are designed to dismantle or assemble a specific part or assemblies without causing damage to them. Cleaning

Pumps, three indications of centrifugal pump cavitating

three indications of centrifugal pump cavitating

Vibration damping and size-factors in clutch design , Vibration Damping : ...

Vibration Damping : Suitable mechanism should be incorporated within the clutch to eliminate (to reduce it drastically) noise produced in the transmission. Size : The size of

Concept of absolute thermodynamic temperature scale, (a) Illustrate the con...

(a) Illustrate the concept of absolute thermodynamic temperature scale on the basis of second law. (b) In a Steady flow apparatus , 13.5 KJ of work is done by each kg of fluid.

Determine the magnitude and nature of the force, A frame PQRSTU is hinged t...

A frame PQRSTU is hinged to a rigid support at P and is simply supported at T. It is loaded as indicated in the figure below. Determine the magnitude and nature of the force in the

Final stress analysis, Once vendor drawings are received and piping isometr...

Once vendor drawings are received and piping isometric drawings are prepared, the Mechanical engineer will provide a final stress package to the stress engineer per The stress a

What is specific gravity?, What is specific gravity? what do you mean by 1p...

What is specific gravity? what do you mean by 1pascal? Concept of pressure difference? Sol) The "specific gravity" of a meterial is the ratio of its density to the density of

Grinder-tool and equipment , Grinder: Grinders are used to sharpen the cut...

Grinder: Grinders are used to sharpen the cutting edges of the tools. They are basically fast rotating grinding wheels carried at one or two ends of a shaft. The grinding wheel ar

Overhead bridge crane, Overhead Bridge Crane Figure below shows a jib cr...

Overhead Bridge Crane Figure below shows a jib crane. In this type of crane the hook can move in a circular path. A jib crane is preferred where lifting of the jobs is requ

DEVELOP A COMPUTER PROGRAM, Develop a computer program that can be used for...

Develop a computer program that can be used for internal flow analysis in SI units. The program should be able to: ? Get the required input data from the user ? Decide the flow ty

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd