Exhibit 3.5 The Following Questions Are Based on This Problem and Accompanying

question 58

Multiple Choice

Exhibit 3.5
The following questions are based on this problem and accompanying Excel windows.
A company is planning production for the next 4 quarters. They want to minimize the cost of production. The production cost is stable but demand and production capacity vary from quarter to quarter. The maximum amount of inventory which can be held is 12,000 units and management wants to keep at least 3,000 units on hand. Quarterly inventory holding cost is 3% of the cost of production. The company estimates the number of units carried in inventory each month by averaging the beginning and ending inventory for each month. There are currently 5,000 units in inventory. The company wants to produce at no less than one half of its maximum capacity in any quarter.
-Refer to Exhibit 3.5. Which cells are changing cells in the accompanying Excel spreadsheet?

• A) C4:F4
• B) C9:F9
• C) F20
• D) C12:F12

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Definitions:

Population Means

The mean values calculated from the entirety of specified populations.

Independent Random Samples

Independent random samples are samples selected from a population in such a way that each member of the population has an equal and independent chance of being included.

Population Means

The average value of all the data points in a population, representing a central tendency of the population data.

Confidence Interval

A variety of values coming from collected sample information, presumed to hold the value of an unknown parameter within the population.