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Caleb operates a small network of organic grocery stores that he services from a

ID: 339459 • Letter: C

Question

Caleb operates a small network of organic grocery stores that he services from a central warehouse. Caleb was contacted by his wholesaler who asked whether he would consider changing his order quantity on a line of packaged dinners. Citing high costs of servicing Caleb’s orders (mainly because the wholesaler paid the transportation), the wholesaler offered to negotiate with Caleb to change (increase) his order quantity. Caleb thought the wholesaler was making about 20% profit on the packaged dinners and he guessed that the wholesaler’s holding costs were about 22% of its unit costs. Caleb looked at his own records and compiled the following:

Warehouse

Annual Demand (D)

126,000

Order cost per lot (S)

$ 100

Unit cost (C)

$   9.00

Holding cost factor (k)

31%

Distributer

Order cost per lot (S)

$ 400

Unit cost (C)

$    7.50

Holding cost factor (k)

22%



Complete the tables below. Important: Round order quantity and number of orders to nearest whole number before calculating order cost. Round all other numbers to the nearest whole number and enter as #,###

Warehouse Orders Independently

Orders optimize joint costs

Economic Quantity Ordered by Warehouse

3,005

Quantity that minimizes total cost

Warehouse ordering cost

$

4,200

Warehouse ordering cost

$

Warehouse holding cost

4,192

Warehouse holding cost

Warehouse total cost

8,392

Warehouse total cost

9,831

Distributer order cost

16,800

Distributer order cost

Distributer holding cost

2,479

Distributer holding cost

Distributer total cost

19,279

Distributer total cost

13,995

Total cost across both parties

$

27,671

Total cost across both parties

$


What exactly are the supply chain dollar savings from ordering at a quantity that optimizes supply chain costs?

$

What is the minimum amount that Caleb could consider accepting to change his Order Quantity?

$

Warehouse

Annual Demand (D)

126,000

Order cost per lot (S)

$ 100

Unit cost (C)

$   9.00

Holding cost factor (k)

31%

Distributer

Order cost per lot (S)

$ 400

Unit cost (C)

$    7.50

Holding cost factor (k)

22%

Explanation / Answer

This is my answer

The Copy Shop runs 1000 copy jobs per week. The probability of their copy machine jamming on any one job is 0.002. What is the probability that The Copy Shop can get through a week with no jams?

this is a binomial distribution because we have "p" and "n" the parameters of a binomial distribtuon

Thank you...

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