Question

In: Economics

Miso Computer produces computer parts and buys platinum from one of its suppliers. Each part carries...

Miso Computer produces computer parts and buys platinum from one of its suppliers. Each part carries 1 ounce of copper. Annual demand for parts follows a normal distribution with an average of 7000 parts and a standard deviation of 2000. The copper supplier takes 5 weeks to deliver the material after the order is placed. Miso uses 40% annual interest to compute the cost of maintaining inventory. Copper buys it at $0.25 per ounce. The company uses a short material cost of $25 per ounce of copper and putting an order to the supplier costs $80. Note: Show off 52 weeks in a year. Careful with unit conversion.

a) Suppose Miso is interested in the decision to ensure that 85% of cycles meet all demand:
i.  What should be the lot size? (whole number):
ii.   And the size of the reorder point? (whole number):

b) Assume that you want to calculate the average total cost of annual inventory, including setup, material maintenance cost, and short cost; provide the individual values for each of these terms (two decimal places, annually):
i. "Setup":
ii. Keeping the material:
iii. Costos por cortos de material:

c)   What type 1 service level are you guaranteeing with the system in part a? (provide service level in percentage terms, two significant decimal places):

d) What type 2 service level are you guaranteeing with the system in part a? (provide service level in percentage terms, two significant decimal places):

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