Problem Solution: Kuiper Leda Inc.

Running head: PROBLEM SOLUTION: KUIPER LEDA INC.

Problem Solution: Kuiper Leda Inc.

University of Phoenix Dallas

May 23, 2006

MBA - 550

Problem Solution: Kuiper Leda Inc.

In this paper we recall and further develop an inventory model formulated by one student of MBA 550. One will make some generalizations of the theorems of Chase, Jacobs and Aquilano with application to a reliability type inventory problem. The basic assumption made in connection with this reproduction is that the delivery of the ordered amount takes place in an interval, according to some arbitrary process, rather than at one time period. The setback is to determine that minimum level of safety stock, which ensures continuous production, without interruption, by a prescribed high possibility. The model is further developed first by its combination with another inventory control model, the order up to S model and then, by the formulations of a fixed and a dynamic type stochastic programming models; hence we have Kuiper Leda Inc.

Situation Background (Step 1)

Kuiper Leda, further referred to as, K.L. is an electronic component manufacturer that specializes in the production of electronic control units (ECUs) and sensors