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CWD Electronics sells computers, which it orders from the USA. Because of shipping and handling costs, each order must be for 12 units. Because of the time it takes to receive an order, the company places an order every time the present stock drops to 6 units. It costs $120 to place an order. It costs the company $75 in lost sales when a customer asks for a computer and the warehouse is out of stock. It costs $5 to keep each computer stored in the warehouse. If a customer cannot purchase a computer when it is requested, the customer will not wait until one comes in but will go to a competitor. The demand for computers and the time required to receive an order once it is placed (lead time) has the following probability distribution: Demand/ Lead time (weeks) Probability week Probability 2 0.20 0 0.10 3 0.65 1 0.45 4 0.15 2 0.30 3 0.15 The company has 10 computers in stock. Orders are always received at the beginning of the week. Note that a lead time of 2 weeks imply that an order placed at the end of week one will arrive at the beginning of week 4. Required a) Construct the appropriate random number mappings for the random variables starting with .00.... b) Simulate CWD's ordering and sales policy for 15 weeks. c) Compute the average cost of the policy([" demand .49 .67 .06 .30 .95 .01 .10 .70 .80 .66 .69 .76 .86 .56 84 lead time .84 .79 .35 .56 .64 .21 Use the following headings lead- SOC OC TC Week OI URAI RN D DFEI SO order RN time IC

CWD Electronics sells computers, which it orders from the USA. Because of shipping and handling costs, each order must be for 12 units. Because of the time it takes to receive an order, the company places an order every time the present stock drops to 6 units. It costs $120 to place an order. It costs the company $75 in lost sales when a customer asks for a computer and the warehouse is out of stock. It costs $5 to keep each computer stored in the warehouse. If a customer cannot purchase a computer when it is requested, the customer will not wait until one comes in but will go to a competitor. The demand for computers and the time required to receive an order once it is placed (lead time) has the following probability distribution: Demand/ Lead time (weeks) Probability week Probability 2 0.20 0 0.10 3 0.65 1 0.45 4 0.15 2 0.30 3 0.15 The company has 10 computers in stock. Orders are always received at the beginning of the week. Note that a lead time of 2 weeks imply that an order placed at the end of week one will arrive at the beginning of week 4. Required a) Construct the appropriate random number mappings for the random variables starting with .00.... b) Simulate CWD's ordering and sales policy for 15 weeks. c) Compute the average cost of the policy([" demand .49 .67 .06 .30 .95 .01 .10 .70 .80 .66 .69 .76 .86 .56 84 lead time .84 .79 .35 .56 .64 .21 Use the following headings lead- SOC OC TC Week OI URAI RN D DFEI SO order RN time IC

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section2.5: Ordering With Quantity Discounts And Demand Uncertainty
Problem 5P
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CWD Electronics sells computers, which it orders from the USA. Because of shipping and handling costs, each order must be for 12 units. Because of the time it takes to receive an order, the company places an order every time the present stock drops to 6 units. It costs $120 to place an order. It costs the company $75 in lost sales when a customer asks for a computer and the warehouse is out of stock. It costs $5 to keep each computer stored in the warehouse. If a customer cannot purchase a computer when it is requested, the customer will not wait until one comes in but will go to a competitor. The demand for computers and the time required to receive an order once it is placed (lead time) has the following probability distribution: Demand/ Lead time (weeks) Probability week Probability 2 0.20 0 0.10 3 0.65 1 0.45 4 0.15 2 0.30 3 0.15 The company has 10 computers in stock. Orders are always received at the beginning of the week. Note that a lead time of 2 weeks imply that an order placed at the end of week one will arrive at the beginning of week 4. Required a) Construct the appropriate random number mappings for the random variables starting with .00.... b) Simulate CWD's ordering and sales policy for 15 weeks. c) Compute the average cost of the policy([" demand .49 .67 .06 .30 .95 .01 .10 .70 .80 .66 .69 .76 .86 .56 84 lead time .84 .79 .35 .56 .64 .21 Use the following headings lead- SOC OC TC Week OI URAI RN D DFEI SO order RN time IC
Transcribed Image Text:CWD Electronics sells computers, which it orders from the USA. Because of shipping and handling costs, each order must be for 12 units. Because of the time it takes to receive an order, the company places an order every time the present stock drops to 6 units. It costs $120 to place an order. It costs the company $75 in lost sales when a customer asks for a computer and the warehouse is out of stock. It costs $5 to keep each computer stored in the warehouse. If a customer cannot purchase a computer when it is requested, the customer will not wait until one comes in but will go to a competitor. The demand for computers and the time required to receive an order once it is placed (lead time) has the following probability distribution: Demand/ Lead time (weeks) Probability week Probability 2 0.20 0 0.10 3 0.65 1 0.45 4 0.15 2 0.30 3 0.15 The company has 10 computers in stock. Orders are always received at the beginning of the week. Note that a lead time of 2 weeks imply that an order placed at the end of week one will arrive at the beginning of week 4. Required a) Construct the appropriate random number mappings for the random variables starting with .00.... b) Simulate CWD's ordering and sales policy for 15 weeks. c) Compute the average cost of the policy([" demand .49 .67 .06 .30 .95 .01 .10 .70 .80 .66 .69 .76 .86 .56 84 lead time .84 .79 .35 .56 .64 .21 Use the following headings lead- SOC OC TC Week OI URAI RN D DFEI SO order RN time IC
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