Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

z value Associated service level 0.84 80% 1.28 90% 1.65 95% 2.33 99% 3.08 99.9% KraftyCity is a large retailer that sells power tools and

image text in transcribed

z value

Associated service level

0.84

80%

1.28

90%

1.65

95%

2.33

99%

3.08

99.9%

KraftyCity is a large retailer that sells power tools and other hardware supplies. One of its products is the KraftyMan workbench. Information on the workbench is as follows. AnnualdemandHoldingcostOrderingcost=1,750=$17=$110 Click the icon to view the table of z values. a. What is the economic order quantity for the workbench? The EOQ is (Enter your response rounded to the nearest whole number.) b. Suppose that KraftyCity has to pay $38 per workbench for orders under 300 but only $22 per workbench for orders of 301 or more. What order quantity should KraftyCity use? KraftyCity should order workbenches at a time. (Enter your response rounded to the nearest whole number.) c. The lead time for KraftyCity workbenches is 4 weeks, with a standard deviation of 1.4 weeks, and the average weekly demand is 10 , with a standard deviation of 5 workbenches. What should the reorder point be if KraftyCity wants to provide a 90% service level? The reorder point is 62 workbenches. (Enter your response rounded to the nearest whole number.) d. Now suppose the supplier of workbenches guarantees KraftyCity that the lead time will be a constant 4 weeks, with no variability (i.e., standard deviation of lead time =0 ). Recalculate the reorder point using the demand and service level information in part c. The reorder point if the standard deviation of lead time is 0 weeks is workbenches. (Enter your response rounded to the nearest whole number.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Small Business Management Entrepreneurship and Beyond

Authors: Timothy s. Hatten

5th edition

538453141, 978-0538453141

More Books

Students also viewed these General Management questions