2 3 Sh Received An Offer From Another Supplier To Purchase The Tables For 498 A Unit But With A Lead Time Of 60 Days 1 (44.29 KiB) Viewed 62 times
2.3 SH received an offer from another supplier to purchase the tables for $498 a unit, but with a lead time of 60 days. Should this supplier be preferred over the current supplier (who sells the tables for $500 a unit and requires only 3 days lead time), if the 92% service level needs to be maintained? Base your answer merely on the total cost. In the Answers sheet answer Yes/No, and show the requested quantities.
2. The annual mean demand for a certain kitchen-table at Smart Home (SH) is 9,000 units. Ordering cost per order is $50, holding rate is 22%, and unit cost is $500. To apply the EOQ model with service level, demand records were collected daily. The daily demand is normally distributed, with a mean of 25 units and a standard deviation of 15 units. Lead time = 3 days
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