(Iterative (Q, R) System Problem) Fatih owns a boutique cof…

 (Iterative (Q, R) System Problem) Fatih owns a boutique coffee shop called Bean & Brew, specializing in handcrafted artisan coffee blends sourced from a small cooperative in Costa Rica. Each 1-pound bag of coffee beans costs Fatih $10 to purchase. Because of the limited seasonal harvest and processing time, it takes a full year to receive new shipments. Fatih applies an annual holding cost rate of 15% to account for storage and spoilage risks. If a customer request cannot be fulfilled due to stockouts, Fatih estimates a goodwill loss of $20 per missed sale. Every time he places an order, he incurs a $25 import and processing fee. Based on past sales records, Fatih expects to sell approximately 300 bags per year, with a standard deviation of 50 bags. Assume that the demand for the coffee beans follows a normal distribution. NOTE: The question statement above is the same for all 4 questions in this exam. Question: Assuming a normal demand distribution, determine the optimal (Q,R) policy. Continue iterating until the gap between successive iterations of the Q value is less than 5%. (i.e., 

(Service Level Questions) Ava runs an outdoor gear rental co…

(Service Level Questions) Ava runs an outdoor gear rental company specializing in luxury camping tents. Each tent costs $200, and restocking takes one year. She applies a 10% annual holding cost rate and estimates a $50 goodwill loss for each stockout. Ordering costs $120. Ava expects to rent 500 tents per year, with a demand standard deviation of 150 tents. Demand is normally distributed. NOTE: The question statement above is the same for all 7 questions in this exam. Question: What is the optimal order quantity (Q) if Ava wants to prevent stockouts in 85% of order cycles (Type 1 Service)?

 (Iterative (Q, R) System Problem) Fatih owns a boutique cof…

 (Iterative (Q, R) System Problem) Fatih owns a boutique coffee shop called Bean & Brew, specializing in handcrafted artisan coffee blends sourced from a small cooperative in Costa Rica. Each 1-pound bag of coffee beans costs Fatih $10 to purchase. Because of the limited seasonal harvest and processing time, it takes a full year to receive new shipments. Fatih applies an annual holding cost rate of 15% to account for storage and spoilage risks. If a customer request cannot be fulfilled due to stockouts, Fatih estimates a goodwill loss of $20 per missed sale. Every time he places an order, he incurs a $25 import and processing fee. Based on past sales records, Fatih expects to sell approximately 300 bags per year, with a standard deviation of 50 bags. Assume that the demand for the coffee beans follows a normal distribution. NOTE: The question statement above is the same for all 4 questions in this exam. Question: Assume that the optimal order size is 100, and optimal reorder point is 450. Calculate the safety stock.