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31-05-2024
Business

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A machine produces items to stock according to the following base-stock policy: a production run is started as soon as the number of items on stock drops below level 6, and the production run is stopped as soon as the number of items on stock reaches level 6 again. Customer orders (each for a single item) follow a Poisson process with a rate of 6 per day (= 24 hours). he
production times of items are exponentially distributed with a mean of 4 hours. Orders are satisﬁed in order of arrival, and demands that cannot be satisﬁed directly from stock are lost. Items are taken from stock in the order in which they were produced.

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