Refer to Example 2. Determine if a plan to use subcontracting at a maximum rate of 50 units per period as needed with no overtime would achieve a lower total cost than the plan shown in Example 2. Again, plan for a zero inventory balance at the end of period 6. Regular production can be less than regular capacity.
> How can managers use the results of A-B-C classification?
> Prepare a scatter diagram for each of these data sets and then express in words the apparent relationship between the two variables. Put the first variable on the horizontal axis and the second variable on the vertical axis. a. Age 24 30 22 25 33 27
> Why might it be inappropriate to use inventory turnover ratios to compare inventory performance of companies that are in different industries?
> What potential benefits and risks do RFID tags have for inventory management?
> Briefly describe each of the costs associated with inventory.
> What are the requirements for effective inventory management?
> As part of a major plant renovation project, the industrial engineering department has been asked to balance a revised assembly operation to achieve an output of 240 units per eight-hour day. Task times and precedence relationships are as follows: Do e
> What are some ways in which a company can reduce the need for inventories?
> What is the single-period model, and under what circumstances is it appropriate?
> Explain how a decrease in setup time can lead to a decrease in the average amount of inventory a firm holds, and why that would be beneficial.
> The purchasing agent for a company that assembles and sells air-conditioning equipment in a Latin American country noted that the cost of compressors has increased significantly each time they have been reordered. The company uses an EOQ model to determi
> Describe briefly the A-B-C approach to inventory control.
> Prepare a cause-and-effect diagram to analyze why a machine has produced a large run of defective parts.
> What is meant by the term service level? Generally speaking, how is service level related to the amount of safety stock held?
> Under what circumstances would the amount of safety stock held be large? Small? Zero?
> a. List the major assumptions of the EOQ model. b. How would you respond to the criticism that EOQ models tend to provide misleading results because values of D, S, and H are, at best, educated guesses?
> As a supermarket manager, how would you go about evaluating the criticalness of an inventory shortage?
> To be competitive, many fast-food chains began to expand their menus to include a wider range of foods. Although contributing to competitiveness, this has added to the complexity of operations, including inventory management. Specifically, in what ways d
> Name some ways that a layout can help or hinder productivity.
> Sam is at the post office to mail a package. After he pays for mailing the package, the clerk asks if he would like to buy some stamps. Sam pauses to think before he answers. He doesn’t have a credit card with him. After paying for the package, he has ab
> UPD Manufacturing produces a range of health care appliances for hospital as well as for home use. The company has experienced a steady demand for its products, which are highly regarded in the health care field. Recently the company has undertaken a rev
> Would you recommend changing to the optimal order interval? Explain.
> Describe the importance of inventory management as it relates to the Farmers Restaurant.
> List and briefly explain: a. The dimensions of service quality b. The determinants of quality
> The supplier Kristin uses is located in Ohio. Why might Kristin consider dealing with a nearby supplier instead of the one in Ohio? What reasons might there be for not switching suppliers?
> Given the above information and an on-hand inventory of 12, determine the risk of stock out at the end of initial lead time and at the end of the second lead time. The lead time is 2 days and orders are placed once a week.
> Given the following information, provide an example of how much of Farmers Sausage Gravy Mix should be ordered. You are doing the order for Thursday. Also, Kristin would like a service level of 95 percent, and you have found that there is a standard devi
> What general trade-offs are involved in master scheduling in terms of the frozen portion of the schedule?
> How has technology had an impact on master scheduling?
> Who needs to interface with the master schedule and why?
> According to a study by the Alliance of American Insurers, it costs more than three times the original purchase price in parts and labor to reconstruct a wrecked Chevrolet. Explain the reasons for this large discrepancy in terms of the processes used to
> a. Given the following forecast and steady regular output of 550 every month, what total cost would result if overtime is limited to a maximum of 40 units a month, and subcontracting is limited to a maximum of 10 units a month? Unit costs are: Regular ou
> Determine the total cost for this plan given the following forecast: Use steady regular output of 400 units per month, use overtime as needed for up to 40 units per month, and use subcontracting to make up any needed output to match the forecast. Unit
> A manager would like to know the total cost of a chase strategy that matches the forecast below using a steady regular production rate of 200 units a month, a maximum of 20 units per month of overtime, and subcontracting as needed to make up any shortage
> What are the main advantages of a product layout? The main disadvantages?
> Compute the total cost for each aggregate plan using these unit costs: Regular output = $40 Overtime = $50 Subcontract = $60 Average Balance Inventory = $10 c. (Refer to part b.) After complaints from some workers about working overtime every month du
> Prepare a schedule like that shown in Figure 11.12 for the following situation: The forecast is 80 units for each of the first two periods and 60 units for each of the next three periods. The starting inventory is 20 units. The company uses a chase strat
> Determine the available-to-promise (ATP) quantities for each period for Problem 21.
> Prepare a master schedule like that shown in Figure 11.11 given this information: The forecast for each week of an eight-week schedule is 50 units. The MPS rule is to schedule production if the projected on-hand inventory would be negative without it. Cu
> Update the master schedule shown in Figure 11.11 given these updated inputs: It is now the end of week 1; customer orders are 25 for week 2, 16 for week 3, 11 for week 4, 8 for week 5, and 3 for week 6. Use the MPS rule of ordering production when projec
> Prepare a master production schedule for industrial pumps in the manner of Figure 11.11 in the chapter. Use the same inputs as the example, and lot sizes of 70, but change the MPS rule from “schedule production when the projected on-hand inventory would
> Dundas Bike Components Inc. of Wheelville, Illinois, manufactures bicycle wheels in two different sizes for the Big Bike Co. assembly plant located across town. David Dundas, the firm’s owner-manager, has just received Big Bikeâ&#
> What improvements can you suggest for the plant?
> Layout decisions affect a wide range of facilities, from factories, supermarkets, offices, department stores, and warehouses, to malls, parking lots and garages, and kitchens. Layout is also important in the design of some products such as the interiors
> Solve Problem 16 using an inventory carrying cost of $2 per unit per period.
> Select four tools and describe how they could be used for process improvement.
> Refer to Example 3. Suppose that regular-time capacity will be reduced to 440 units in period 3 to accommodate a companywide safety inspection of equipment. What will the additional cost of the optimal plan be as compared to the one shown in Example 3? A
> Suppose that an increase in warehousing costs and other costs brings inventory carrying costs to $2 per unit per month. All other costs and quantities remain the same. Determine a revised solution to this transportation problem. Solve by modifying Table
> Verify the transportation solution shown in Example 3.
> Prepare an aggregate plan that uses overtime ($9 per unit, maximum output 25 units per period) and inventory variation. Try to minimize backlogs. The ending inventory in period 9 should be zero, and the limit on backlogs is 60 units per period. Compute t
> Suppose another option is to use part-time workers to assist during seasonal peaks. The cost per unit, including hiring and training, is $11. The output rate is 10 units per worker per period for all workers. A maximum of 10 part-time workers can be used
> Refer to Solved Problem 1. Prepare two additional aggregate plans. Call the one in the solved problem plan A. For plan B, hire one more worker at a cost of $200. Make up any shortfall using subcontracting at $8 per unit, with a maximum of 20 units per pe
> Wormwood, Ltd., produces a variety of furniture products. The planning committee wants to prepare an aggregate plan for the next six months using the following information. Subcontracting can handle a maximum of 10 units per month. Beginning inventory
> Nowjuice, Inc., produces Shakewell® fruit juice. A planner has developed an aggregate forecast for demand (in cases) for the next six months. Develop an aggregate plan using each of the following guidelines and compute the total cost for eac
> What are heuristic approaches, and why are they used in designing layouts?
> List the steps of process improvement.
> Briefly describe the two main layout types.
> Briefly describe salt production, from brine production to finished round cans.
> A manager of a store that sells and installs spas wants to prepare a forecast for January, February, and March of next year. Her forecasts are a combination of trend and seasonality. She uses the following equation to estimate the trend component of mont
> After plotting demand for four periods, an emergency room manager has concluded that a trend adjusted exponential smoothing model is appropriate to predict future demand. The initial estimate of trend is based on the net change of 30 for the three period
> a. Obtain the linear trend equation for the following data on new checking accounts at Fair Savings Bank and use it to predict expected new checking accounts for periods 16 through 19. b. Use trend-adjusted smoothing with α =&
> Air travel on Mountain Airlines for the past 18 weeks was: Week …………………..Passengers 1 ………………………………………….….405 2 ………………………………………….….410 3 ………………………………………….….420 4 ………………………………………….….415 5 ………………………………………….…..412 6 ………………………………………….….420 7 …………………………………………
> Freight car loadings over a 12-year period at a busy port are as follows: a. Determine a linear trend line for expected freight car loadings. b. Use the trend equation to predict expected loadings for weeks 20 and 21. c. The manager intends to install
> An electrical contractor’s records during the last five weeks indicate the number of job requests: Predict the number of requests for week 6 using each of these methods: a. Naive b. A four-period moving average c. Exponential smoothin
> National Scan, Inc., sells radio frequency inventory tags. Monthly sales for a seven-month period were as follows: a. Plot the monthly data on a sheet of graph paper. b. Forecast September sales volume using each of the following: (1) The naive approa
> A commercial bakery has recorded sales (in dozens) for three products, shown as follows: a. Predict orders for the following day for each of the products using an appropriate naive method. b. What should the use of sales data instead of demand imply?
> 4.A manager uses a trend equation plus quarterly relatives to predict demand. Quarter relatives are SR1 = .90, SR2 = .95, SR3 = 1.05, and SR4 =&Ac
> A manager uses this equation to predict demand for landscaping services: Ft  = 10 + 5t. Over the past eight periods, demand has been as follows: Is the forecast performing adequately? Explain. Period,
> Describe each of these systems: craft production, mass production, and lean production.
> A manager has just received an evaluation from an analyst on two potential forecasting alternatives. The analyst is indifferent between the two alternatives, saying that they should be equally effective. a. What would cause the analyst to reach this co
> A textbook publishing company has compiled data on total annual sales of its business texts for the preceding nine years: a. Using an appropriate model, forecast textbook sales for each of the next five years. b. Prepare a control chart for the forecas
> The classified department of a monthly magazine has used a combination of quantitative and qualitative methods to forecast sales of advertising space. Results over a 20-month period are as follows: Mnth ……..….Error 1 ………………………….−8 2 ………………………….−2 3……………
> Refer to the data in problem 22. a. Compute a tracking signal for the 10th month for each forecast using the cumulative error for months 1 to 10. Use action limits of ± 4. Is there bias present? Explain. b. Compute 2s control limits for each forecast.
> The manager of a travel agency has been using a seasonally adjusted forecast to predict demand for packaged tours. The actual and predicted values are as follows: a. Compute MAD for the fifth period, then update it period by period using exponential sm
> Lovely Lawns, Inc., intends to use sales of lawn fertilizer to predict lawn mower sales. The store manager estimates a probable six-week lag between fertilizer sales and mower sales. The pertinent data are: a. Determine the correlation between the two
> The following data were collected during a study of consumer buying patterns: 1. Plot the data. 2. Obtain a linear regression line for the data. 3. What percentage of the variation is explained by the regression line? 4. Use the equation determined in
> The manager of a seafood restaurant was asked to establish a pricing policy on lobster dinners. Experimenting with prices produced the following data: a. Plot the data and a regression line on the same graph. b. Determine the correlation coefficient an
> Long-Life Insurance has developed a linear model that it uses to determine the amount of term life insurance a family of four should have, based on the current age of the head of the household. The equation is: y = 850 − .1x where y = Insurance needed ($
> Two independent methods of forecasting based on judgment and experience have been prepared each month for the past 10 months. The forecasts and actual sales are as follows: a. Compute the MSE and MAD for each forecast. Does either forecast seem superio
> List the trade-offs you would consider for each of these decisions: a. Driving your own car versus public transportation. b. Buying a computer now versus waiting for an improved model. c. Buying a new car versus buying a used car. d. Speaking up in c
> Two different forecasting techniques (F1 and F2) were used to forecast demand for cases of bottled water. Actual demand and the two sets of forecasts are as follows: a. Compute MAD for each set of forecasts. Given your results, which forecast appears t
> .An analyst must decide between two different forecasting techniques for weekly sales of roller blades: a linear trend equation and the naive approach. The linear trend equation is Ft = 124 + 2t, and it was developed using data from periods 1 through 10
> The following table shows a tool and die company’s quarterly sales for the current year. What sales would you predict for the first quarter of next year? Quarter relatives are SR1 = 1.10, SR2Â&n
> What is DF and why is it important?
> Explain how flexibility in production systems relates to the forecast horizon and forecast accuracy.
> Contrast the reactive and proactive approaches to forecasting. Give several examples of types of organizations or situations in which each type is used.
> How accurate is your local five-day weather forecast? Support your answer with actual data.
> List the specific weaknesses of each of these approaches to developing a forecast: a. Consumer surveys. b. Sales force composite. c. Committee of managers or executives.
> What are the main advantages that quantitative techniques for forecasting have over qualitative techniques? What limitations do quantitative techniques have?
> Choose the type of forecasting technique (survey, Delphi, averaging, seasonal, naive, trend, or associative) that would be most appropriate for predicting: a. Demand for Mother’s Day greeting cards. b. Popularity of a new television series. c. Demand for
> What are models and why are they important?
> Suppose a software producer is about to release a new version of its popular software. What information do you think it would take into account in forecasting initial sales?
> Which type of forecasting approach, qualitative or quantitative, is better?
> How is forecasting in the context of a supply chain different from forecasting for just a single organization? List possible supply chain benefits and discuss potential difficulties in doing supply chain forecasting.
> Discuss how you would manage a poor forecast.
> It has been said that forecasting using exponential smoothing is like driving a car by looking in therear-view mirror. What are the conditions that would have to exist for driving a car that are analogousto the assumptions made when using exponential smo
> Give three examples of unethical conduct involving forecasting and the ethical principle each violates.
> Omar has heard from some of his customers that they will probably cut back on order sizes in the next quarter. The company he works for has been reducing its sales force due to falling demand and he worries that he could be next if his sales begin to fal
> What are some of the potential benefits of a more formalized approach to forecasting?
> M&L Manufacturing makes various components for printers and copiers. In addition to supplying these items to a major manufacturer, the company distributes these and similar items to office supply stores and computer stores as replacement parts for pr
