Practice Problem 11 Before the summer season, a retailer wants to have barbeque grills in its inventory. The demand. expected to be 4000 units but uncertain with a standard deviation of demand estimated at 500. considers entering into a buyback agreement with a manufacturer of barbeque grills. The manufacturer's production cost is $300 per unit and charges the retailer $500 for each grill. The retailer sets a retail price of $950. If by the end of the summer season, the retailer ends up havin unsold grills in its stock, it will send them back to the manufacturer and will receive $400 for ea grill. The manufacturer will sell these grills at $250 per unit. If the retailer's profit is estimated a $1,727,384, calculate the supply chain surplus.

Practice Problem 11 Before the summer season, a retailer wants to have barbeque grills in its inventory. The demand. expected to be 4000 units but uncertain with a standard deviation of demand estimated at 500. considers entering into a buyback agreement with a manufacturer of barbeque grills. The manufacturer's production cost is $300 per unit and charges the retailer $500 for each grill. The retailer sets a retail price of $950. If by the end of the summer season, the retailer ends up havin unsold grills in its stock, it will send them back to the manufacturer and will receive $400 for ea grill. The manufacturer will sell these grills at $250 per unit. If the retailer's profit is estimated a $1,727,384, calculate the supply chain surplus.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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