A manager is going to purchase new processing equipment and, Ask an Expert

Management Studies

A manager is going to purchase new processing equipment and must decide on the number of spare parts to order with the new equipment. The spares cost $200 each, and any unused spares will have an expected salvage value of $50 each. The probability of usage can be described by this distribution:

Number	0	1	2	3
Probability	.10	.50	.25	.15

If a part fails and a spare is not available, two days will be needed to obtain a replacement and install it. The cost for idle equipment is $500 per day. What quantity of spares should be ordered?

a. Use the ratio method.

b. Use the tabular method (see Table 13.4).

Text Book: Operations Management By Santosh Patnaik.

View complete question

Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M91595169

Have any Question?Write your Review or question?

Related Questions in Operation Management

Water wheelies manufactures high-pressure sprinkler heads

Water Wheelies manufactures high-pressure sprinkler heads. These are produced periodically at a rate of 960 per day. Demand is steady at 720 per day. Assume 250 days per year. Each production run has a set-up cost of $12 ...

Competitor analysisplease choose who you believe is your

Competitor Analysis Please choose who you believe is your most significant competitor and respond to the following questions. Business Definition: What business does this competitor appear to be in? What markets do they ...

Assessmentnbsp -knowledge questionsinstructionsthe

ASSESSMENT -KNOWLEDGE QUESTIONS Instructions The information contained in this section lists the questions that you will need to develop a written response. These questions are theoretical and provide evidence of your u ...

Imagine that you are the hr manager for a new company just

Imagine that you are the HR manager for a new company just opening its doors in your community. The owners have asked you to prepare a vision for compensating the staff. They do not want specific policies but rather guid ...

Us airlines ndash case studythe united states airline

US airlines – Case Study The United States Airline Industry The U.S. airline industry has long struggled to make a profit. Analysts point to a number of factors that have made the industry a difficult place in which to d ...

You are the owner and operator of a restaurant that stays

You are the owner and operator of a restaurant that stays open 24 hours a day. On Friday night, a group of teenage patrons entered your restaurant, dined and were disorderly in their conduct towards other patrons. Your e ...

1 which of the following terms best represents the

1. Which of the following terms best represents the individual brought in from the outside to help an organization carry out a new organizational change process or initiative? A. Change initiator B. Change agent C. Chang ...

A manager just received a new price list from a supplier it

A manager just received a new price list from a supplier. It will now cost 1$ a box for order quantities of 801 or more boxes, 1.10$ a box for 200 to 800 boxes, and 1.20$ a box for smaller quantities. ordering and carryi ...

Regarding their effects on competition for jobs and talent

Regarding their effects on competition for jobs and talent, what are the key differences between the opinions expressed in "It's a Flat World," by Thomas Friedman on the one hand, and the views of Richard Florida in "The ...

Gven this information expected demand during lead time

Given this information: Expected demand during lead time = 330 units Standard deviation of lead time demand = 20 units Use Table. (Z Table) Determine each of the following, assuming that lead time demand is distributed n ...

4,153,160 Questions Asked
13,132 Experts
2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Recent Questions

Ask Operation Management Expert