28. An artist's supply shop stocks a variety of different items to satisfy the needs of both amateur and professional ar

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28 An Artist S Supply Shop Stocks A Variety Of Different Items To Satisfy The Needs Of Both Amateur And Professional Ar 1 (499.74 KiB) Viewed 74 times

28. An artist's supply shop stocks a variety of different items to satisfy the needs of both amateur and professional artists. In each case described, what is the appropriate inven- tory control model that the store should use to manage the replenishment of the item described? Choose your answer from the following list and be sure explain your answer in each case. Simple EOQ Finite production rate EOQ with quantity discounts Resource-constrained EOQ Newsvendor model Newsvendor model with service level (Q, R) model with stock-out cost (Q, R) model with Type 1 service level (Q, R) model with Type 2 service level Other type of model a. A highly volatile paint thinner is ordered once every three months. Cans not sold during the three-month period are discarded. The demand for the paint thinner exhibits considerable variation from one three-month period to the next. b. A white oil-based paint sells at a fairly regular rate of 600 tubes per month and requires a six-week order lead time. The paint store buys the paint for $1.20 per tube. c. Burnt sienna oil paint does not sell as regularly or as heavily as the white. Sales of the burnt sienna vary considerably from one month to the next. The useful lifetime of the paint is about two years, but the store sells almost all the paint prior to the two-year limit. d. Synthetic paint brushes are purchased from an East Coast supplier who charges $1.60 for each brush in orders of under 100 and $1.30 for each brush in orders of 100 or greater. The store sells the brushes at a fairly steady rate of 40 per month for $2.80 each.