Using stochastic models, help is needed for questions 4 and 5 kindly
Your team is asked to analyze the nished product logistics for ACME which produces 3 different electronic car components (A, B, and C). Component A. B and C has a volume of Sm', 10m}, and 20m], respectively. ACME receives orders for its products and nishes the production on the same day. Orders arrive according to a Poisson process with an arrival mte of 2 orders per day. Each order contains a single component and the content of the order has a probability mass function ['(x) where P(A)=0.5, P(B)=0.4, P(C)=0.l. The production capacity of the rm is 3 components per day. lfthe company receives more than 3 orders in a day, the excess order is referred to another manufacturer. ACME is not responsible for the production ofthe excess demand. The company currently uses a thirdrparty logistics (JVPL) provider to distribute its nished products to its customers. in this system, whenever the 37PL ships thc products it charges a standard per mj transportation fee to the manufacturer. The previous analysis illustrated that the company considers \"a shipment in every 4 huslncss elm/S" to be optimal based on the minimization of the expected average transportation cost. The transportation cost is equal to the sum ofa xed shipment cost of $500, variable shipment cost ($k per m3), and inventory holding cost ($c per day per m3). The rm considers another logistics plan which allows them to rent a truck [or each shipment. 'l ruck rental costs are 53K) and $Kz per shipment for 45m3 and loam-l trucks, respectively. Your team aims to understand whether the new truckrforerentebased logistics option can be more efcient than the existing 3-PL option. For this purpose: 1. Assume that ACME'S responsibility for its products ends when they are shipped. Build a Markov Chain model that can kccp track of the production of the components and their transporlation. 2, Derive: the necessab/ input parameters (It. KI' K2a c) for the model from the literature, logistic company websites, or inverse analysis of the model (model calibration). 3. Calculate the expected cost of each policy and determine the best shipment interval for the truck-forre11t-based option, Discuss which shipment method the company should use, 4. As an operation management expert. you lcnow that dynamic quantity-based policies (a shipment is done when the current number of items to send passes a certain size threshold) perform better than periodic shipment policies. Determine an effective (or optimal) shipment size threshold for both options and compare it with the policy discussed in Section 2. How frequently are products sent to the customer under this policy.7 5. ACME works on a 100% ontime shipment policy promising delivery within 5- work days. Find a way to incorporate this principle when determining what type to incorporate this factor into the analysis ofideal shipment timing decisions
