OPERATIONS MANAGEMENT Homework # 15-17 HOMEWORK PROBLEM - SO-WEEK SIMULATION Order Cost = $28 Annual Usage = 5,000 units Price = $22.50 Carry Cost = 40% No Discount Demand during Average Lead Time Frequency 70 80 90 Average Lead Time in Weeks 1. Stockout Cost = 25 Wecks of Operation 50 100 110 120 130 6 12 20 26 17 8 4 . . . . . • Remember to enter a negative # for demand when you are finished. Stockout Cost on a Per Unit Basis 25 Beginning Quantity on Hand = 150 Lead Time Distribution f 22 8 3 . . . OPERATIONS MANAGEMENT Homework # 15-17 cont. 1 2 3 Demand Distribution use same one above since Average Lead Time = 1 week Run a 50-week simulation Also, try at least 2 other combinations of Order Point and Order Quantity to see if you can reduce the total cost. First Simulation. Order Cost Annual Forecasted Usage Price Carry Cost SOLUTION EOQ INPUT rk # 15, 16, 17 QTY Discount? NO Enter the Demand During Average Lead Time Here (when complete -after the 130, enter a SOLUTION Reorder 100 110 120 130 Stockout Carry Total Recommended Reorder Point Safety Stock enter YES when the program ask if you wish to run the simulation Enter the lead time distribution here Enter the demand during average lead time here # of weeks to simulate 50
