Question
A company has the following inventory policy: inventory is observed and when this is 2 less, 2 products are ordered. If inventory is 3 more
A company has the following inventory policy: inventory is observed and when this is 2 less, 2 products are ordered. If inventory is 3 more products, it is not ordered. The probability of having 0 customers is 0.3, 1 customer 0.5 and 2 customers 0.2. The daily event series is: (1) the inventory is observed, (2) depending on the policy, the products are ordered, (3) the products arrive immediately, (4) finally the products are sold according to demand. 2.1 How many states best describe the system? 2.2 How many absorbing states are there? 2.3 Calculate the steady-state probabilities 2.4 If you have an ordering cost of $ 400 (regardless of the amount ordered) and an inventory cost of $ 50 / product, what is the expected cost from the policy?
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