1.

Which SKU has the most volatile demand (highest coefficient of

variation)? The coefficient of variation is defined as Cv=σ/μ.

2. When María saw the high volatility of this item, she asks you to
analyze the volatility of a sample of 60 SKUs (different jeans models)
in terms of Coefficient of Variation (CV). In particular, she wants to
know the percentage of SKUs that have a CV greater than or equal to
0.47

3. In addition to the volatility, you also propose to analyze the fast

moving items. You believe that the fast moving, highly volatile SKUs
should be managed separately with more time spent on improving the
forecasting capabilities. You select the criteria for fast moving to be
selling 30 or more units per week and the criteria for highly volatile as
having a CV greater than or equal to 0.47. What percentage of the
total profit is contributed by these Fast Moving and Highly Volatile
SKUs (both criteria satisfied)?

4. You select the criteria for fast moving to be selling 30 or more units
per week and the criteria for less volatile as having a CV less than or
equal to 0.47. What percentage of the total profit is contributed by
these high Moving and less Volatile SKUs (both criteria satisfied)?

5. You select the criteria for fast moving to be selling 30 or less units per
week and the criteria for highly volatile as having a CV more than or
equal to 0.47. What percentage of the total profit is contributed by
these slow Moving and high Volatile SKUs (both criteria satisfied)?

6. Let’s run now the ABC analysis based on profitability. What

percentage of the total profit is contributed by the top 11 SKUs of the
60, as ranked by profit?

7. What percentage of the total profit is contributed by the bottom 27

SKUs of the 60, ranked by profit?

Q3, 4 AND 5 CARRY 1 MARK EACH. OTHER QUESTIONS CARRY 0.5

MARKS EACH. TOTAL 5 MARKS