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4) A perishable product is purchased by a retailer for #800 and sold at a price of #900. Because the product is perishable, it has no value if not sold on the first day. Daily demand (x) varies at random according to the following distribution: 12 0.35 15 0.05 11 13 14 10 0.05 0.20 0.20 0.15 X P (X) The retailer wishes to determine the level to stock each day, so as to maximize expected daily profit. You're required to: i) determine what stock decision will result in the maximum expected daily profit.

4) A perishable product is purchased by a retailer for #800 and sold at a price of #900. Because the product is perishable, it has no value if not sold on the first day. Daily demand (x) varies at random according to the following distribution: 12 0.35 15 0.05 11 13 14 10 0.05 0.20 0.20 0.15 X P (X) The retailer wishes to determine the level to stock each day, so as to maximize expected daily profit. You're required to: i) determine what stock decision will result in the maximum expected daily profit.

Practical Management Science
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
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4) A perishable product is purchased by a retailer for #800 and sold at a price of #900. Because the product is perishable, it has no value if not sold on the first day. Daily demand (x) varies at random according to the following distribution: 12 0.35 15 0.05 X 10 11 13 14 P (X) 0.05 0.20 0.20 0.15 The retailer wishes to determine the level to stock each day, so as to maximize expected daily profit. You're required to: i) determine what stock decision will result in the maximum expected daily profit.
Transcribed Image Text:4) A perishable product is purchased by a retailer for #800 and sold at a price of #900. Because the product is perishable, it has no value if not sold on the first day. Daily demand (x) varies at random according to the following distribution: 12 0.35 15 0.05 X 10 11 13 14 P (X) 0.05 0.20 0.20 0.15 The retailer wishes to determine the level to stock each day, so as to maximize expected daily profit. You're required to: i) determine what stock decision will result in the maximum expected daily profit.
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