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

Working principle of carburettor , Working Principle of Carburettor : All ...

Working Principle of Carburettor : All carburettors work on one basic principle, the venturi. A venturi is a very simple device that changes air pressure by changing the velocity

How is bearing capacity of soil varied, How is bearing capacity of soil var...

How is bearing capacity of soil varied? The bearing capacity of soil varies not only with its strength but also with the magnitude and distribution of the load. When a load Q,

Determine reactions of the overhanging beam, Determine reactions of the ove...

Determine reactions of the overhanging beam: Determine r eactions at points A and B of the overhanging beam as shown in the figure given below.

Moment of couple - mechanics, Moment of couple: Sol.: The moment of ...

Moment of couple: Sol.: The moment of couple is the product of the force (that is one of the forces of two equal and opposite parallel forces) and the arm of couple. Math

Find out the modulus of elasticity, Find out the modulus of elasticity: ...

Find out the modulus of elasticity: A unidirectional FRP is produced with fibre volume ratio of 60%. The density of fibre is 1480 kg/m 3 and that of matrix is 1200 kg/m 3 . C

Path function, prove that work is path function

prove that work is path function

What is one way shear, What is one way shear? Explain with a suitable demon...

What is one way shear? Explain with a suitable demonstration. One Way Shear This worked out seen a similar case is the case of wall footings. For square footings also the cr

Mesh-current method, how do we solve circuits using the mesh current method...

how do we solve circuits using the mesh current method

Find the stress developed in copper and steel, A steel rod of 20 mm diamete...

A steel rod of 20 mm diameter passes centrally through a copper tube of 50 mm external diameter and 40 mm internal diameter. The tube is closed at each end by rigid plates of negli

Ballast - permanent way, Ballast: Ballast is the layer of broken ston...

Ballast: Ballast is the layer of broken stone provided on the formation on which the sleepers rest. The stones are cubical in shape and pass through 50 mm square mesh. The fu

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