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Assignment-2 ORBI4423

The document summarizes a simulation model used to analyze customer demand for hot water heaters at a plumbing business. The simulation found that with a stock of 8 heaters, the business would be out of stock 3 times in a 20-week period. The average sales per week from the simulation was 6.75, similar to the expected value of 6.88 calculated analytically. A second simulation analyzed customer wait times at a bank drive-thru and found that the average wait exceeded the target of 2 minutes, indicating more tellers were needed during peak times.

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Tashio Shiota
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Download as PDF, TXT or read online on Scribd
44 views

Assignment-2 ORBI4423

The document summarizes a simulation model used to analyze customer demand for hot water heaters at a plumbing business. The simulation found that with a stock of 8 heaters, the business would be out of stock 3 times in a 20-week period. The average sales per week from the simulation was 6.75, similar to the expected value of 6.88 calculated analytically. A second simulation analyzed customer wait times at a bank drive-thru and found that the average wait exceeded the target of 2 minutes, indicating more tellers were needed during peak times.

Uploaded by

Tashio Shiota
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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Topic Coverage: Simulation Model:

1. Higgins Plumbing and Heating maintains a stock of 30-gallon hot water heaters that it sells to
homeowners and installs for them. Owner Jerry Higgins likes the idea of having a large supply on hand
to meet customer demand, but he also recognizes that it is expensive to do so. He examines hot water
heater sales over the past 50 weeks and notes the following:

Hot Water Heater Sales Number of Weeks this


Per Week Number was Sold
4 6
5 5
6 9
7 12
8 8
9 7
10 3

a. If Higgins maintains a constant supply of 8 hot water heaters in any given week, how many times
will he be out of stock during a 20-week simulation? We use random numbers from the seventh
column of Table 14.4, beginning with the random digits 10.

Solution:

Because the variable of interest is the number of sales per week, a fixed time increment model should be used.

Heater Sales Probability Random Number Interval


4 0.12 01 to 12
5 0.10 13 to 22
6 0.18 23 to 40
7 0.24 41 to 64
8 0.16 65 to 80
9 0.14 81 to 94
10 0.06 95 to 00
1.00
Week Random Simulated Week Random Simulated
Number Sales Number sales
1 10 4 11 08 4
2 24 6 12 48 7
3 03 4 13 66 8
4 32 6 14 97 10
5 23 6 15 03 4
6 59 7 16 96 10
7 95 10 17 46 7
8 34 6 18 74 8
9 34 6 19 77 8
10 51 7 20 44 7

Answer:

With a supply of 8 heaters, Higgins will be out of stock three times during the 20-week period (in weeks 7, 14,
and 16).

b. What is the average number of sales per week (including stockouts) over the 20-week period?

Solution:

Average sales by simulation = total sales = 135 = 6.75 per week.


20 weeks 20

Answer: 6.75 per week

c. Using an analytic nonsimulation technique, what is the expected number of sales per week? How
does this compare with the answer in part (b)?

Solution:

Using expected values,

E (sales) = 0.12(4 heaters) + 0.10(5) + 0.18(6) + 0.24(7) + 0.16(8) + 0.14(9) + 0.06(10) = 6.88 heaters

Answer: 6.88 heaters

With a longer simulation, these two approaches will lead to even closer values.
2. The manager of Denton Savings and Loan is attempting to determine how many tellers are needed at
the drive-in window during peak times. As a general policy, the manager wishes to offer service such
that average customer waiting time does not exceed 2 minutes. Given the existing service level, as
shown in the following data, does the drive-in window meet this criterion?

Data for Service Time


Service Time (Min) Probability
0 0.00
1.0 0.25
2.0 0.20
3.0 0.40
4.0 0.15

Data for Customer Arrivals


Service Time (Min) Probability
0 0.10
1.0 0.35
2.0 0.25
3.0 0.15
4.0 0.10
5.0 0.05

Customer Random Interval to Time of Random Service Start End Wait Idle
No. No. Arrival Arrival No. Time Service Service Time Time
1 50 2 9:02 52 3 9:02 9:05 0 2
2 28 1 9:03 37 2 9:05 9:07 2 0
3 68 2 9:05 82 3 9:07 9:10 2 0
4 36 1 9:06 69 3 9:10 9:13 4 0
5 90 4 9:10 98 4 9:13 9:17 3 0
6 62 2 9:12 96 4 9:17 9:21 5 0
7 27 1 9:13 33 2 9:21 9:23 8 0
8 50 2 9:15 50 3 9:23 9:26 8 0
9 18 1 9:16 88 4 9:26 9:30 10 0
10 36 1 9:17 90 4 9:30 9:34 13 0
11 61 2 9:19 50 3 9:34 9:37 15 0
12 21 1 9:20 27 2 9:37 9:39 17 0
13 46 2 9:22 45 2 9:39 9:41 17 0
14 01 0 9:22 81 3 9:41 9:44 19 0
15 14 1 9:23 66 3 9:44 9:47 21 0

Answer:

The drive-in window clearly does not meet the manager’s criteria for an average wait time of 2 minutes.
As a matter of fact, we can observe an increasing queue buildup after only a few customer simulations.
This observation can be confirmed by expected value calculations on both arrival and service rates.
Table of Random Numbers

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