Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Question content area Part 1 A gourmet coffee shop in downtown San Francisco is open 2 0 0 days a year and sells an average
Question content area
Part
A gourmet coffee shop in downtown San Francisco is open days a year and sells an average of pounds of Kona coffee beans a day.Demand can be assumed to be distributed normally with a standard deviation of pounds per day After orderingfixed cost$ per order beans are always delivered from Hawaii in exactly days. Perpound annual holding costs for the beans are $ Refer to the standard normal table LOADING... for zvalues.
Part
a What is the economic order quantityEOQ for Kona coffee beans? enter your response here pounds round your response to the nearest whole number
Part
b What are the total annual holding costs of stock for Kona coffee beans? $enter your response here round your response to two decimal places
Part
c What are the total annual ordering costs for Kona coffee beans? $enter your response here round your response to two decimal places
Part
d Assume that management has specified that no more than a risk of stockout during lead time is acceptable. What should the reorder pointROP be enter your response here pounds round your response to two decimal places
Part
e What is the safety stock needed to attain a risk of stockout during lead time? enter your response here pounds round your response to two decimal places
Part
f What is the annual holding cost of maintaining the level of safety stock needed to support a risk$enter your response here round your response to two decimal places
Part
g If management specified that a risk of stockout during lead time would be acceptable, the safety stock holding costs will
increase
not change
decrease
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started