Holooly Plus Logo
Holooly Plus Logo

Question 12.SP.2: The Warren W. Fisher Computer Corporation purchases 8,000 tr...

The Warren W. Fisher Computer Corporation purchases 8,000 transistors each year as components in minicomputers. The unit cost of each transistor is $10, and the cost of carrying one transistor in inventory for a year is $3. Ordering cost is $30 per order. What are (a) the optimal order quantity, (b) the expected number of orders placed each year, and (c) the expected time between orders? Assume that Fisher operates on a 200-day working year.

The "Step-by-Step Explanation" refers to a detailed and sequential breakdown of the solution or reasoning behind the answer. This comprehensive explanation walks through each step of the answer, offering you clarity and understanding.
Our explanations are based on the best information we have, but they may not always be right or fit every situation.
The Blue Check Mark means that this solution has been answered and checked by an expert. This guarantees that the final answer is accurate.
Learn more on how we answer questions.

This Question has been Answered.

Subscribe

Already have an account?

Login

Related Answered Questions

The demand at Arnold Palmer Hospital for a specialized surgery pack is 60 per week, virtually every week. The lead time from McKesson, its main supplier, is normally distributed, with a mean of 6 weeks for this product and a standard deviation of 2 weeks. A 90% weekly service level is desired. Find

Verified Answer:
Here the demand is constant and lead time is varia...

The daily demand for 52” flat-screen TVs at Sarah’s Discount Emporium is normally distributed, with an average of 5 and a standard deviation of 2 units. The lead time for receiving a shipment of new TVs is 10 days and is fairly constant. Determine the reorder point and safety stock for a 95%

Verified Answer:
The ROP for this variable demand and constant lead...

What safety stock should Ron Satterfield Corporation maintain if mean sales are 80 during the reorder period, the standard deviation is 7, and Ron can tolerate stockouts 10% of the time?

Verified Answer:
From Appendix I, Z at an area of .9 (or 1 - .10) =...

Children’s art sets are ordered once each year by Ashok Kumar, Inc., and the reorder point, without safety stock (dL), is 100 art sets. Inventory carrying cost is $10 per set per year, and the cost of a stockout is $50 per set per year. Given the following demand probabilities during the lead time,

Verified Answer:
INCREMENTAL COSTS SAFETY STOCK CARRYING COST STO...

Whole Nature Foods sells a gluten-free product for which the annual demand is 5,000 boxes. At the moment, it is paying $6.40 for each box; carrying cost is 25% of the unit cost; ordering costs are $25. A new supplier has offered to sell the same item for $6.00 if Whole Nature Foods buys at least

Verified Answer:
Step 1, under the lowest possible price of $6.00 p...

Leonard Presby, Inc., has an annual demand rate of 1,000 units but can produce at an average production rate of 2,000 units. Setup cost is $10; carrying cost is $1. What is the optimal number of units to be produced each time?

Verified Answer:
Q^*_p = \sqrt{\frac{2DS}{H \left(1 - \frac{...

Annual demand for notebook binders at Meyer’s Stationery Shop is 10,000 units. Brad Meyer operates his business 300 days per year and finds that deliveries from his supplier generally take 5 working days. Calculate the reorder point for the notebook binders.

Verified Answer:
L = 5 days d = \frac{10,000}{300} =...

David Alexander has compiled the following table of six items in inventory at Angelo Products, along with the unit cost and the annual demand in units: Use ABC analysis to determine which item(s) should be carefully controlled using a quantitative inventory technique and which item(s) should not be

Verified Answer:
The item that needs strict control is 33CP, so it ...

SINGLE-PERIOD INVENTORY DECISION. Chris Ellis’s newsstand, just outside the Smithsonian subway station in Washington, DC, usually sells 120 copies of the Washington Post each day. Chris believes the sale of the Post is normally distributed, with a standard deviation of 15 papers. He pays 70 cents

Verified Answer:
SOLUTION \blacktriangleright a) Ser...

ROP FOR VARIABLE DEMAND AND VARIABLE LEAD TIME. The Circuit Town store’s most popular item is six-packs of 9-volt batteries. About 150 packs are sold per day, following a normal distribution with a standard deviation of 16 packs. Batteries are ordered from an out-of-state distributor; lead time is

Verified Answer:
SOLUTION \blacktriangleright From t...