Scenario 11.4 - The Gutter
A rodent infestation has left a landlord with a major cleanup job;in fact,the cleanup will consist of ripping out all the walls and ceilings of an 1860 square foot house to replace them.A trip to the local home improvement store reveals that 4'x8' sheets of drywall have three price points as indicated in the table.Another consideration for the landlord is that he is equipped with only a humble half-ton pickup truck,that can hold at most 20 sheets.His truck sips fuel,so he considers only wear and tear on his vehicle at $5 to haul all the sheets he will use for the job.The holding percentage is 20%.The landlord believes the entire job - all walls and ceiling - will require 10,080 square feet of drywall.
$$\begin{array} { | l | c | }
\hline{ \text { Purchase Quantity } } & \text { Price Per Sheet } \
\hline 1 - 20 & \$ 9.40 \
\hline 21 - 100 & \$ 9.30 \
\hline 101 \text { or more } & \$ 9.20 \
\hline
\end{array}$$
-Use the information in Scenario 11.4 to determine the average inventory level resulting from purchasing the optimal number of sheets per order.Assume he can buy only an integer-multiple of sheets.
A)7.65
B)20.58
C)38.27
D)50.5

Question

Scenario 11.4 - The Gutter
A rodent infestation has left a landlord with a major cleanup job;in fact,the cleanup will consist of ripping out all the walls and ceilings of an 1860 square foot house to replace them.A trip to the local home improvement store reveals that 4'x8' sheets of drywall have three price points as indicated in the table.Another consideration for the landlord is that he is equipped with only a humble half-ton pickup truck,that can hold at most 20 sheets.His truck sips fuel,so he considers only wear and tear on his vehicle at $5 to haul all the sheets he will use for the job.The holding percentage is 20%.The landlord believes the entire job - all walls and ceiling - will require 10,080 square feet of drywall.
 $$\begin{array} { | l | c | } 
\hline{ \text { Purchase Quantity } } & \text { Price Per Sheet } \
\hline 1 - 20 & \$ 9.40 \
\hline 21 - 100 & \$ 9.30 \
\hline 101 \text { or more } & \$ 9.20 \
\hline
\end{array}$$
-Use the information in Scenario 11.4 to determine the average inventory level resulting from purchasing the optimal number of sheets per order.Assume he can buy only an integer-multiple of sheets.
A)7.65
B)20.58
C)38.27
D)50.5

Quizplus · Accepted Answer

The Answer of Scenario 11.4 - The Gutter
A rodent infestation has left a landlord with a major cleanup job;in fact,the cleanup will consist of ripping out all the walls and ceilings of an 1860 square foot house to replace them.A trip to the local home improvement store reveals that 4'x8' sheets of drywall have three price points as indicated in the table.Another consideration for the landlord is that he is equipped with only a humble half-ton pickup truck,that can hold at most 20 sheets.His truck sips fuel,so he considers only wear and tear on his vehicle at $5 to haul all the sheets he will use for the job.The holding percentage is 20%.The landlord believes the entire job - all walls and ceiling - will require 10,080 square feet of drywall.
 $$\begin{array} { | l | c | } 
\hline{ \text { Purchase Quantity } } & \text { Price Per Sheet } \
\hline 1 - 20 & \$ 9.40 \
\hline 21 - 100 & \$ 9.30 \
\hline 101 \text { or more } & \$ 9.20 \
\hline
\end{array}$$
-Use the information in Scenario 11.4 to determine the average inventory level resulting from purchasing the optimal number of sheets per order.Assume he can buy only an integer-multiple of sheets.
A)7.65
B)20.58
C)38.27
D)50.5

Scenario 11 -Use the Information in Scenario 11