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MTH601 Operations Research Assignment 2 Solution Fall 2012

Question#1                                                                                                              

The annual demand for a component is 7500 units. The carrying cost is Rs.600/unit/year,the ordering cost is Rs.1600 per order and the shortage cost is Rs.2200/unit/year.

Data available

Demand           D         =          7500 Units/year,           650 Units/month

Carrying cost    C1        =          600/Unit /Year

Holding cost     C2        =          1600/Per Order/Year

Shortage cost   C3        =          2200/Unit/Year

Find the following;

1)      Optimal values of economic order quantity

2) Maximum inventory

3) Maximum shortage quantity

4) Cycle time

5) Inventory period

 

LECTURE 16

Question#2                                                                                                               

Find Percentage of cumulative Annual Usage by using ABC analysis.

Items.

Annual usage

Rank

Cumulative annual usage

% of cumulative annual usage

1

3000

1

3000

24%

2

1250

5

5400

42%

3

2400

2

7800

61%

4

960

6

9300

73%

5

2400

3

10550

83%

6

700

7

11510

91%

7

500

8

12210

96%

8

1500

4

12710

100%
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