POM 2

Question 1

The average time (in days) it takes a unit to flow through the system

Answer 1

Days-of-Supply=T

Question 2

The number of times the average inventory flows through a process in a period of time (usually one year).

Answer 2

Inventory Turns (Turnover)=R/I=1/T

Question 3

The ratio of the cost to hold an item in inventory during a designated time period (typically a year) relative to the cost to purchase the item

Answer 3

Inventory holding cost percentage

Question 4

The actual holding cost incurred for each unit of item in inventory =𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦 ℎ𝑜𝑙𝑑𝑖𝑛𝑔 𝑐𝑜𝑠𝑡 𝑝𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 ∗𝑐𝑜𝑠𝑡 𝑝𝑒𝑟 𝑢𝑛𝑖𝑡 ∗𝑙𝑒𝑛𝑔𝑡ℎ 𝑜𝑓 𝑡𝑖𝑚𝑒 𝑡ℎ𝑒 𝑖𝑡𝑒𝑚 𝑠𝑡𝑎𝑦𝑖𝑛𝑔 𝑖𝑛 𝑖𝑛𝑣𝑒𝑛𝑡𝑜𝑟𝑦

Answer 4

Inventory holding cost per unit

Question 5

The probability that all demand is served within an interval of time

Answer 5

In-stock probability

Question 6

The probability that demand for an item exceeds its inventory during a period of time

Answer 6

Stockout probability = 1- in-stock probability

Question 7

The fraction of demand satisfied

Answer 7

Fill rate

Question 8

Reasons for Bullwhip Effect

Answer 8

Overreactive Ordering,Order Batching, Price Promotions

Question 9

Overreactive Ordering

Answer 9

Share information along the supply chain so everyone is aware
Avoid the overreactive temptation

Question 9

Order Batching

Answer 9

Reduce minimum batch quantities for orders

Question 10

Price Promotions

Answer 10

Eliminate price promotions

Question 11

Variability Due to Supply Chain Partner Performance

Answer 11

Failure in Quantity
Failure in Quality
Failure in Finances
Failure in Operating Practice

Question 12

Variability Due to Disruptions

Answer 12

Natural Disruptions
Political/Economic Disruptions

Question 13

To ensure a stable process, we need:

Answer 13

Arrival rate (demand) < Capacity rate (supply)

Question 14

queue will grow without limit
or this can only be temporary

Answer 14

if process is stable

Question 15

Queue growth rate

Answer 15

Demand – Capacity

Question 16

Length of queue at time t

Answer 16

t * (Demand – Capacity)

Question 17

Time to serve the Qth person in queue

Answer 17

Q/Capacity

Question 18

Time to serve the person arriving at time t

Answer 18

t*(Demand - Capacity)/Capacity

Question 19

Average time to serve a unit

Answer 19

½T(Demand –Capacity)/Capacity

Question 20

The queue length depends on:

Answer 20

Demand- On average how often do customers arrive?; Supply- On average how long does it take to serve a customer?; Variability- How to measure variability?

Question 21

Demand

Answer 21

𝑎 = average interarrival time

Question 22

Supply

Answer 22

𝑝 = average processing time

Question 23

Variability

Answer 23

Coefficient of variation = standard deviation / mean
CVa and CVp for arrival and service processes

Question 24

Utilization

Answer 24

flow rate / capacity = (1/𝑎)/(1/𝑝) = 𝑝/𝑎

Question 25

Average time in queue:

Answer 25

𝑇_𝑞=𝑝×(𝑈𝑡𝑖𝑙𝑖𝑧𝑎𝑡𝑖𝑜𝑛/(1−𝑈𝑡𝑖𝑙𝑖𝑧𝑎𝑡𝑖𝑜𝑛))×((𝐶𝑉_𝑎^2+𝐶𝑉_𝑝^2)/2)

Question 26

Average time in the system

Answer 26

𝑇=𝑇𝑞+𝑝

Question 27

Average number of customers waiting in line:

Answer 27

𝐼_𝑞=𝑅×𝑇_𝑞=(𝑇_𝑞/𝑎)

Question 28

Average number of customers in service:

Answer 28

𝐼_𝑝=𝑅×𝑝=𝑝/𝑎

Question 29

Average total number of customers in the system

Answer 29

𝐼=𝐼_𝑝+𝐼

Question 30

Multiple Servers- 𝑈𝑡𝑖𝑙𝑖𝑧𝑎𝑡𝑖𝑜𝑛

Answer 30

(𝑓𝑙𝑜𝑤 𝑟𝑎𝑡𝑒)/𝑐𝑎𝑝𝑎𝑐𝑖𝑡𝑦=(1/𝑎)/(𝑚/𝑝)=𝑝/(𝑎×𝑚)

Question 31

Minimum number of servers

Answer 31

𝑚𝑖𝑛𝑖𝑚𝑢𝑚 𝑛𝑢𝑚𝑏𝑒𝑟 𝑜𝑓 𝑠𝑒𝑟𝑣𝑒𝑟𝑠 >𝑝/𝑎

Question 32

Are pooling systems quicker or slower than separated queue systems

Answer 32

quicker

Question 32

Are pooling systems quicker or slower than separated queue systems

Answer 32

quicker

Question 33

The process of creating statements about outcomes of variables that presently are uncertain and will only be realized in the future

Answer 33

Forecasting

Question 34

Daily to monthly
Used for staffing, scheduling, and short-term pricing

Answer 34

Short-term forecast

Question 35

center line

Answer 35

is the average