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

Explain the intensive properties of a system, Explain the Intensive Propert...

Explain the Intensive Properties of a System Intensive properties are those, which have similar value for any part of the system or the properties which are independent of the

Show leak area preparation, Q. Show Leak Area Preparation? Clearly mark...

Q. Show Leak Area Preparation? Clearly mark the location of the leak on the flange with a permanent marker. Notes: 1. Depressurizing hydrocarbon lines in non-emergency event

Determine the apparent range of the target - radar system, Consider radar w...

Consider radar with a PRF of 5 kHz. What is the maximum unambiguous range R ua of this radar, in km?  If a target is located at a range of 50 miles, how many pulses will the r

Introduction to basic troubleshooting of motorcycle , INTRODUCTION: Previo...

INTRODUCTION: Previously, you studied about the repairing some parts of a motorcycle. In this unit, we shall mainly emphasise on the troubleshooting of the basic problems. This un

Group technology, comparing the different coding systems ?

comparing the different coding systems ?

Determine the increase in pressure in vessel, Determine the increase in pre...

Determine the increase in pressure in vessel: A thin spherical vessel of diameter 750 mm & wall thickness 8 mm is filled through water at atmospheric pressure. Determine the i

Fatigue loading on materials, what are the factors that affecting the fatig...

what are the factors that affecting the fatigue behaviour of materials?

Dual cycle of heat engine.., how to calculate the mean effective pressure o...

how to calculate the mean effective pressure of a dual cycle

Geometric modelling, Geometric modelling: Geometric modelling is an in...

Geometric modelling: Geometric modelling is an integral part of any Computer-Aided-Design (CAD) system. Integration of geometric modelling; computer graphics along with design

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