1. Simulation Examples

2. Queuing Example • Most of the example has already been discussed. • Important points to consider: • Management of event clock and simulation clock. As per the event list, the simulation clock jumps to the next event. This is determined by scanning event list at the end of each event’s processing for the next event. • Processing of event is instantaneous – No simulated time passes during processing. • Termination conditions are to carefully coded. • Tie-breaking rules?

3. Inventory Example • For a single product, a company wants to decide how many items to stock for each of the next n months. • Random demand – Size is random (IID) with: • Also, time between two demands is IID Exp(0.1 months).

4. Inventory Example • At the beginning of each month, the inventory level is reviewed and the order quantity decided. • If the company orders Z items, it costs K + iZ, where K is the set-up cost and i is the incremental cost. • Lead time is IID U(0.5,1) months. • Inventory policy is (s, S). If I is the inventory level at the beginning of the month,

5. Inventory Example • When the demand occurs, it is satisfied if we have sufficient inventory. • In case of insufficient inventory, the excess demand is backordered and satisfied by future deliveries. • When the order arrives, first the backlog is cleared and remainder is added to the inventory. • Additional costs involved: holding and shortage/backorder costs. • Let I(t) be the inventory at time t.

6. Inventory Example • I+(t) is the number of items held in inventory at time t. The time-average (per month) # of inventory held for a n-month horizon is: • I-(t) is the number of items backlogged at time t. The time-average (per month) # of backlogs for a n-month horizon is: