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Inventory Homework4 Solution Problem4+5 Revised | PDF | Probability Theory | Statistical Theory
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Inventory Homework4 Solution Problem4+5 Revised

The document presents calculations related to demand forecasting, including expected demand, standard deviation, order quantities, and expected profits for different scenarios. It details the expected demand of 540 units, a standard deviation of 135.65, and optimal order quantities for three stock bins. Additionally, it outlines the expected profit for various order quantities and the impact of different parameters on profitability.

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23 views4 pages

Inventory Homework4 Solution Problem4+5 Revised

The document presents calculations related to demand forecasting, including expected demand, standard deviation, order quantities, and expected profits for different scenarios. It details the expected demand of 540 units, a standard deviation of 135.65, and optimal order quantities for three stock bins. Additionally, it outlines the expected profit for various order quantities and the impact of different parameters on profitability.

Uploaded by

sunnifaselene
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as XLSX, PDF, TXT or read online on Scribd
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v 60 $/unit

p 100 $/unit
g 51 $/unit

no. of units (j) 300 400 500 600 700 800


probability (P(j)) 0.1 0.1 0.4 0.2 0.1 0.1
cumulative probability 0.1 0.2 0.6 0.8 0.9 1
(j - µ)2 * P(j) 5760 1960 640 720 2560 6760

a. Expected demand
x̂ 540

b. Standard deviation of demand


σ 135.65

c. Order quantity (discrete)


cu 40
co 9
G(Q*) $0.82
Q* 700

d. Expected profit
E[P(Q*)] 18,939

e. Order quantity (continuous)


x̂ 540
σ 135.65
G(Q*) 0.82
z 0.90
Q* 662.28 --> 700

f. Cost penalty
cost penalty 1,509
a. W = 70,000
SB-1 SB-2 SB-3 Total
p 100 110 200
v 60 80 130
g 51 70 120
B 0 0 0
mean 540 300 200
sigma 136 50 40
M= 0
Pr(X<Q) 0.8163265 0.75 0.875
z 0.9014541 0.67449 1.150349
Q 663 334 246
Qv 39,780 26,720 31,980 98,480 >70000
M= 0.1
Pr(X<Q) 0.6938776 0.55 0.7125
z 0.5068716 0.125661 0.560703
Q 609 306 222
Qv 36,540 24,480 28,860 89,880 >70000
M= 0.2
Pr(X<Q) 0.5714286 0.35 0.55
z 0.1800124 -0.38532 0.125661
Q 564 281 205
Qv 33,840 22,480 26,650 82,970 >70000
M= 0.3
Pr(X<Q) 0.4489796 0.15 0.3875
z -0.12824 -1.036433 -0.285841
Q 523 248 189
Qv 31,380 19,840 24,570 75,790 >70000
M= 0.35
Pr(X<Q) 0.3877551 0.05 0.30625
z -0.285175 -1.644854 -0.506508
Q 501 218 180
Qv 30,060 17,440 23,400 70,900 >70000
M= 0.356
Pr(X<Q) 0.3804082 0.038 0.2965
z -0.304409 -1.774382 -0.534494
Q 499 211 179
Qv 29,940 16,880 23,270 70,090 ~70000
k -0.30 -1.78 -0.53
Gu(k) 0.5668 1.7950 0.7187
E[P(Q)] 18,192 12,599 20,060 50,851

The order quantity of SB-1, SB-2 and SB-3 should be 499 units, 211 units and 179 units, respectively.

b. W = 75,000
M= 0.309
Pr(X<Q) 0.4379592 0.132 0.372875
z -0.156145 -1.116987 -0.324248
Q 519 244 187
Qv 31,140 19,520 24,310 74,970 ~75,000
k -0.15 -1.12 -0.33
Gu(k) 0.4784 1.1859 0.5855
E[P(Q)] 18,601 16,361 20,875 55,837

The expected profit increases by: 4,987


nd 179 units, respectively.

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