The main objective is to introduce students to the technique that can be used for maintaining minimum stocks of items (SKUs) of commercial enterprises at minimum cost using Monte Carlo simulation method. It aims to equip students with the ability to appreciate the complexity of cost in inventory ordering and holding because of uncertainty of demand down-stream of supply chain. Students are also expected to understand and apply inventory re-order planning, given a set of past statistical data of a SKU of a DC distributor.
Is required to carry out the following one simulation of re- order policy over a period of 25 days to determine the following:a. the total cost of operating each policy.B. the total profit for the period. (Nett)c. the cost due to shortages. (Eliminate!)