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

Mechanical data for line designation tables, Q. Mechanical Data for Line De...

Q. Mechanical Data for Line Designation Tables? Line Designation Tables (LDT's) are initially generated by the Piping designers. Design conditions are inputed by the Process di

Cam and followers work, how to do work in cam and follower?anser in hindi t...

how to do work in cam and follower?anser in hindi type

Determine the loading on the beam, Determine the loading on the beam: ...

Determine the loading on the beam: Shear force diagram for a loaded beam is illustrated in Figure. Determine the loading on the beam & therefore, draw the bending moment diagr

Explain rigid screed extension, Normal 0 false false false ...

Normal 0 false false false EN-IN X-NONE X-NONE MicrosoftInternetExplorer4

Show the vessel supports, Q. Show the Vessel Supports? Approved materia...

Q. Show the Vessel Supports? Approved materials and allowable stresses, shall be used for vessels and their supports. For structural shape support members in compression, wh

Define the process of step community, Define the process of STEP community ...

Define the process of STEP community The STEP community is in the process of defining and standardizing a number of domain-specific (mechanical or electrical) Application Proto

Explain Functions of springs as on following points, 1. store energy 2. app...

1. store energy 2. apply force on a body 3. balance force between two bodies 4. absorb vibrations of body

Opportunity cost, whats the example of opportunity cost?

whats the example of opportunity cost?

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