# solution

1. (Average Inventory Part B v1)* A warehouse orders 500 boxes of papers at a time to a manufacturer. The unit time is one week and the manufacturer takes 4 weeks to deliver.
The warehouse manager finds that the weekly demand is random, and normally distributed with a standard deviation of 100. She targets a service level of 97.73%. (Hint: Demand is random in Part B.)
The warehouse holds an average inventory of ___.
(*Show calculations.)

 A. 675 B. 650 C. 625 D. 600 E. 700

1 points

QUESTION 22

1. (Weeks of Supply #1)* Given weeks of supply = 3, annual demand = 10400, and order quantity = 500, safety inventory is ___.
(*Show calculations.)

 A. 350 B. 300 C. 550 D. 200 E. 250

1 points

QUESTION 23

1. (Inventory Turnover v1)* As a supply chain holds LESS inventory, inventory turnover ___ and days of supply ___.
(*Use the formulas to discuss briefly why)

 A. decreases, increases B. decreases, decreases C. increases, increases D. increases, decreases

1 points

QUESTION 24

1. (Impact of Setup Cost 01)*

— If a current setup cost (e.g., transportation cost per order) of 1000 decreases to 333, the current EOQ of 100 changes to the new EOQ of ___.

— If a current setup cost (e.g., transportation cost per order) of 1000 increases to 3000, the current EOQ of 100 changes to the new EOQ of ___.

(*Show calculations.)

 A. 33, 300 B. 58, 173 C. 173, 58 D. 300, 33