TipTop Snowboards in Beech Mountain, NC sell a popular snowboard during the winter ski season. The anticipated demand is normally distributed with a mean of 731 units and standard deviation of 431 units. Tiptop purchases the snowboard from the manufacturer for $217 and sells the snowboard for $395. Any unsold snowboards at the end of ski season will be sold on clearance for $189. It costs $23 to hold a unit in inventory for the entire ski season. Round all entries to one decimal place (nearest tenth). Enter probabilities and percent changes as percentages rounded to nearest tenth of a percent (e.g. 0.7146 should be entered as 71.6%) a) Compute the optimal number of units that TipTop should order: units. b) Compute the probability of a stockout given the optimal order quantity, i.e. that demand exceeds the order quantity. c) Compute the optimal expected profit associated with the order quantity from part (a): $ d) Given the optimal order quantity, how many units does TipTop expect to sell on clearance (on average)? units.
TipTop Snowboards in Beech Mountain, NC sell a popular snowboard during the winter ski season. The anticipated demand is normally distributed with a mean of 731 units and standard deviation of 431 units. Tiptop purchases the snowboard from the manufacturer for $217 and sells the snowboard for $395. Any unsold snowboards at the end of ski season will be sold on clearance for $189. It costs $23 to hold a unit in inventory for the entire ski season. Round all entries to one decimal place (nearest tenth). Enter probabilities and percent changes as percentages rounded to nearest tenth of a percent (e.g. 0.7146 should be entered as 71.6%) a) Compute the optimal number of units that TipTop should order: units. b) Compute the probability of a stockout given the optimal order quantity, i.e. that demand exceeds the order quantity. c) Compute the optimal expected profit associated with the order quantity from part (a): $ d) Given the optimal order quantity, how many units does TipTop expect to sell on clearance (on average)? units.
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter11: Simulation Models
Section: Chapter Questions
Problem 47P
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