Determination of optimal manufacturing quantities by means of a simulation model

Includes bibliographical references (page 83)A computer simulation model has been developed to aid\ud in determination of the quantity of products and components\ud that should be manufactured in order to achieve minimum\ud costs. The simulation model is directed mainly for products,\ud components and common components to different products,\ud all with a discrete demand and manufactured based on a production\ud to order system. It considers the fact that manufacturing\ud process will rarely yield lots that are free of\ud defective parts and therefore the planned manufacturing\ud quantities should consider that these will be present and\ud reduce the final outcome of parts. The uncertainty of the\ud amount of defective parts will probably cause the quantity\ud manufactured to have a shortage or an excess of parts\ud depending on the existing discrepancy between the occurring\ud amount of defective parts and the one originally estimated. Different costs will exist according to the situation and the minimum total cost will be the one desired. The simulation model has been applied for the manufacturing\ud of underwater electrical hull penetrators. Three\ud products with common components have been selected and\ud their demands arbitrarily chosen as shown: (See more in text.