If annual demand is 24,000 units, and the order quantity is 3,000 units, which of the...
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If annual demand is 24,000 units, and the order quantity is 3,000 units, which of the following accurately describes the decision-making environment?
- a. The annual number of order placements will be 8, and average inventory levels will be 1,500
- b. The annual number of order placements will be 8, and average inventory levels will be 3,000
- c. The annual number of order placements will be 12, and average inventory levels will be 12,000
- d. The annual number of order placements will be 24, and average inventory levels will be 12,000
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What is your economic order quantity if the annual demand is 100 units, the order placement cost is $25, and the holding cost per unit per year is $50?
- a. 10 units
- b. 50 units
- c. 100 units
- d. 200 units
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If your EOQ is 60 and the associated total cost is G(Q)=$4,200. What will be the total cost if you use an order quantity of 40 (rather than the EOQ)?
- a. Less than $2,800
- b. $2,800
- c. $4,200
- d. More than $4,200
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Which of the following is the most effective and productive way to reduce the optimal order quantity (Q)?
- a. Reduce total demand
- b. Reduce order or set-up costs
- c. Increase the unit price
- d. Reduce the cost of carrying inventory
- e. All of the above; i.e., they are equally valid strategies
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If demand is normally distributed with mean demand = 20 units/week, standard deviation of demand during lead time = 4 units/week, supply lead time is 3 weeks, and the desired CSL is 99%, what is your reorder point?
- a. 36
- b. 48
- c. 70
- d. 97
Homework Answers
Answering the first question as per Chegg policy
Answer 1: Option A - The annual number of order placements will be 8, and average inventory levels will be 1,500
Explanation: Given that
Annual demand = 24,000 units
Order quantity = 3,000 units
Number of Orders = Annual demand / Order quantity
= 24000 / 3000
= 8 orders
Average inventory level = Order quantity / 2
= 3000 / 2
= 1500 Units
Add Answer to:
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